Monday, July 12, 2021 – DIA 350.03 +.37%, QQQ 362.42 +.39%, SPY 437.08 +.36%
No high-impact data was released. The major indexes hit new highs, but small caps underperformed. The 3 and 10 year Treasury note auctions were lackluster. The 10-year Note Index (TNX) 13.63 +.07 moved higher as markets prepared for the CPI print Tuesday morning. Financials (XLF) 37.07 +.98% outperformed ahead of the release of earnings by Goldman Sachs (GS) 380.50 +2.35% and JPMorgan (JPM) 158.00 +1.43%. Basic materials provider Albermarle (ALB) 187.49 + 6.83% led the S&P 500 as investors appeared to take interest in the company as a provider of lithium for EV battery production. In M&A activity, State Auto Financial (STFC) 50.22 +191% announced it agreed to be acquired by its majority stockholder Liberty Mutual. In biotechnology, Celldex (CLDX) 40.67 +25.49% released positive data for a phase 1b trial experimental treatment CDX-0159 for hives. Virgin Galactic (SPCE) 40.69 -17.30 continuing its recent pattern of high volatility moved lower on a “sell the news” response to a successful trip into space by its founder Richard Branson.
Tuesday, July 13, 2021 – DIA 349.00 -.29%, QQQ 362.42 unch, SPY 435.59 -.34%
The Consumer Price Index (CPI) was released at the highest level since 2008 coming in at an increase of 5.4% (YoY) far higher than the 4.9% expected. Big earnings released by JPMorgan (JPM) 155.65 -1.49% Goldman Sachs (GS) 375.98 -1.19% were greeted with a lackluster consolidation of the shares. JD.com (JD) 76.52 + 4.58%, NetEase (NTES) 112.17 +2.97%, Baidu (BIDU) 184.59 +2.33% led the NASDAQ 100 as China’s top regulator approved Tencent Holdings (TCEHY) 70.96 +3.76% plan to privatize search-engine Sogou. In M&A activity Howard Bancorp (HBMD) 19.79 +26.70% agreed to merge with F.N.B. Corporation (FNB) 11.74 -3.77%. In healthcare, IV device and MRI machine maker IRadimed (IRMD) 37.21 +11.27% continued a second day of upside volatility after a breakout. Celldex (CLDX) 44.60 +9.66% continued its advance from Monday’s news. On the downside Conagra Brands (CAG) 33.98 -5.43% beat on earnings and revenue but said input costs would cut into earnings going forward. Norwegian Cruise Lines (NCLH) 26.09 -4.36% and Carnival (CCL) 22.85 -4.23% were weak on continued news of regulatory requirements by the state of Florida forbidding cruise lines from requiring proof of vaccination for COVID-19 and other news related to the pandemic.
Wednesday, July 14, 2021 – DIA 349.41 +.12%, QQQ 363.07 +.18%, SPY 436.24 +.15%
The Producer Price Index (PPI) was released showing an increase of 5.6% (YoY) vs. far higher than the expectation of 5.1%. Fed chair Powell gave testimony to Congress repeating his contention that inflation will be transitory. Treasury bonds rallied and the 10-Year Note index (TNX) 13.56 -.59 dropped markedly in sympathy. Apple Inc. (AAPL) 149.35 149.15 +2.41% continued to hit new highs while leading the DJIA for the day. Wells Fargo (WFC) 44.95 +3.98% led the S&P 500 after reporting earnings with the best revenue since before the pandemic. (XLE) 50.10 –1.40% continued to underperform with Occidental (OXY) 27.83 -7.48%, Diamondback (FANG) 84.58 -6.06%, Devon (DVN) 27.30 -5.76%, APA Corporation (APA) 19.04 -5.6% the worst performers in the S&P 500. Kura Sushi (KRUS) 47.51 +23.15% was the upside surprise on the day after releasing earnings and receiving an upgrade by Craige-Hallum from a Hold to a Buy and price target raised from $40 to $48 per share in line with the day's performance. The company stated that diners had returned and all restaurants were operating at full capacity. CorePoint Lodging (CPLG) 13.45 +21.83% gave a quarter business update and gave a notice that it was exploring strategic options for its portfolio of hotels. On the downside, GLaukos (GKOS) Corporation 57.82 -21.41% received downgrades by William Blair and Oppenheimer after reporting that it had received a disappointing proposed 2022 physician fee schedule by the Centers for Medicare & Medicaid Services (CMS).
Thursday, July 14, 2021 – DIA 349.94 +.15%, QQQ 360.52 -.70%, SPY 434.75 -.34%
Initial jobless claims came in as expected at 360K. The Philadelphia Fed Manufacturing index came in much weaker than expected at 21.9 v. 28. The 10-Year Note Index (TNX) 12.97 -.59 declined hard. Utilities outperformed (XLU) 65.61 +1.13% outperformed. Energy (XLE) 50.10 -1.40 continued as the laggard group. Baidu (BIDU) 185.52 +2.31% and JD.com (JD) 76.86 +1.87% led the NASDAQ 100. Biogen (BIIB) 328.16 -6.79% declined on news that the FDA has requested the internal inspector general conduct a review of how the FDA approved the Biogen drug Aduhelm. Data storage company Western Digital (WDC) 66.91 -4.43% declined and was the second-worst performer in the S&P500. The shares recently tested the overhead 20 and 50-day moving averages and now are testing the bottom of a trend channel dating back to late March 2021. Kura Sushi (KRUS) 51.39 +8.17% continued its rally from the previous day’s earnings release.
Friday, July 15, 2021 – DIA 346.74 -.86%, QQQ 357.60 -.81%, SPY 431.41 -.77%
Retail sales +.6% (MoM) came in much stronger than the negative -.4% anticipated. Ex-Autos was far stronger at +1.3% v. +.4% expected. The University of Michigan Preliminary Consumer Confidence Survey fell unexpectedly to the lowest level since February on inflation fears, coming in at a reading of 80.8 vs. an 86.5% expectation. The markets traded defensively throughout the day, with Utilities (XLU) 66.27 +1.01% and Healthcare (XLV) 128.62 +.27% performing best. Energy (XLE) 48.68 -2.83% continued striking underperformance with pronounced continued weakness in both Occidental (OXY) 25.94 -4.74% and Diamondback (FANG) 78.36 -4.14%. The city of Los Angeles announced the re-imposition of indoor mask mandates. Continuing COVID-19 headlines throughout the day affected travel & entertainment shares. Cruise lines continued their weakness with Norwegian (NCLH) 23.14 -5.35% and Carnival (CCL) 20.92 -4.69% down. In biotech, FibroGen (FGEN) 14.35 -42.24% was nearly cut in half as an FDA advisory panel recommended against approval of roxadustat as a treatment for anemia for chronic kidney disease. The shares are well off their highs of 57.21 on February 12.
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