Monday, April 19, 2021 – DIA 340.75 -.32%, QQQ 338.88 -.92%, SPY 415.21 -.49%
No high-impact economic data released on the day. It was a consolidation day to some extent as the market digested the move higher into the prior week’s option expiration. Rotation was evident and had a note of algorithmic trading related to treasury yields. The 10-year note index (TNX) 16.01 +.28 (the equivalent of a 28 basis point rise) ticked up. Big weight technology stocks (XLK) 141.65 -.83% were weak along with Consumer Discretionary (XLY) 177.85 -1.12%. Real Estate (XLRE) 41.53 +.31% continued its recent relative strength from the week before. Software companies Synopsis (SNPS) 250.64 -3.88% and DocuSign (DOCU) 223.30 -3.72% led the NASDAQ 100 lower. DocuSign was an early pandemic favorite but has underperformed since September. Marlin Business Services (MRLN) 21.46 +50.70% agreed to be acquired by HPS Investment Partners LLC. Galectin Therapeutics surged (GALT) 2.78 +26.9% after announcing Dr. Ben Carson (famed neurosurgeon and former Secretary of HUD) would become a special consultant to the company.
Tuesday, April 20, 2021 – DIA 338.12 -.77%, QQQ 336.41 -2.47%, SPY 412.17 -.73%
No high-impact economic data released on the day. The markets exhibited a defensive rotation and elements of distribution. News of a new variant of the COVID-19 virus in India appeared to gain attention among traders. As a result, a defensive rotation took hold in the markets. The 10-year index (TNX) 15.62 -.39 dropped significantly (39 basis point equivalent), but failed to spark a rally in Technology (XLY) 175.61 -1.12% as had been the pattern. Utilities (XLU) 67.72 +1.27% led the day, Energy (XLE) 47.07 -2.65% was the worst sector performer reacting to the virus news; oil & gas producers APA Corporation (APA) 17.00 -5.92%, Occidental (OXY) 23.20 -5.46%, and Marathon (MRO) 10.11 -4.89% declined. Financials (XLF) 34.64 -1.87% were also hit on the lower interest rates/flatter yield curve; American Express (AXP) 145.10 -2.32% JPMorgan Chase (JPM) 149.27 -2.21%.
Wednesday, April 21, 2021 – DIA 341.24 +.92%, QQQ 339.29 +.86%, SPY 415.98 +.92%
Spurred on by generally good earnings reports and better economic data in general, the market exhibited a broad and solid rally from the previous 2 days’ worth of selling. Crude oil showed an unexpected build of +.594M barrels vs. the expected -2.975M draw. Energy (XLE) 47.73 +1.4% ignored the build and was among the best performing sectors on the day along with Basic Materials (XLB) 82.97% +1.82%. Utilities (XLU) 67.15 -.84% was the only sector down on the day. Semi equipment chip stocks outperformed as Applied Materials (AMAT) 135.05 +5.02%, Lam Research (LRCX) 641.25+4.6%, and KLA Tencor (KLAC) 331.79 +4.04%. On the downside Netflix (NFLX) 508.9 -7.4% disappointed investors on its earnings call. Despite worsening virus trends outside the United States, cruise companies rallied led by Norwegian (NCLH) 29.51 +10.32% and Carnival (CCL) 27.33 +6.26%
Thursday, April 22, 2021 – DIA 338.12 -3.18 -.93%, QQQ 335.20 -1.21%, SPY 412.27 -.91%
Initial Jobless Claims came in at a pandemic low of 547K continuing a recent trend of mostly good economic news. The markets were in a consolidation of the previous days' bounce-back rally until about 1 pm ET when news broke that the White House was considering a capital gains tax hike. Soon after the announcement, bids suddenly disappeared in the face of a flurry of selling. However, by the closing bell, the markets were off the lows. No sector was positive on the day. Basic Materials (XLB) 81.57 -1.69% Energy (XLE) 47.11 -1.17% reversed from Wednesday's good performance. Cloud computing data company Teradata (TDC) 50.50 +26.63% surprised to the upside after announcing that company profits would exceed prior guidance. Credit reporting service Equifax (EFX) 221.41 +14.94% beat on earnings. Galectin Therapeutics (GALT) 3.46 +17.29% continued a monster rally from earlier in the week after the announcement on Monday the 19th that Dr. Ben Carson would be joining the company as a special consultant.
Friday, April 23, 2021 – DIA 340.43 +.68%, QQQ 339.42 +1.26%, SPY 416.74 +1.08%
New Home Sales came in much better than expected 1.021M v. 886K expected. Markets bounced back from the prior days selling as the capital gains rate hike started to look less than certain. The 10-year note index (TNX) 15.67 +.13 (or 13 basis point equivalent move higher) A “risk-on” rotation was evident and back on as Financials (XLF) 35.38 +1.87% led followed by Basic Materials (XLB) 82.91 +1.64%. The laggards were the low volatility defensive sectors, Consumer Staples (XLP) 69.57 -.26%, and Utilities (XLU) 66.58 -.13%. Goldman Sachs (GS) 339.35 +2.57% led the DJIA higher. Intel (INTC) 59.24 -5.32% reported earnings that beat but revenues were light. However, Intel kind of took the wind out of its own sales by pairing news of an earnings beat in Q1 with an earnings warning for the second quarter and beyond. Some analysts attributed the weakness to the strength of rival chipmaker Advanced Micro Devices (AMD) 82.76 +4.68% which appears to be gaining in data center sales, and market share. Semiconductor Xilinx (XLNX) 129.66 +5.35% led the NASDAQ 100 higher. The stock has been in a pullback since January 11th. Galectin Therapeutics (GALT) 3.91 +13.01% continued to rise.
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