Monday, Oct. 11, 2021 – DIA 344.98 -.73%, QQQ 358.39 -.77%, SPY 434.69 -.72%, IWM 220.31 -.57%
Columbus Day in US /Thanksgiving Day in Canada, banks and government bond market closed, no major data released. Equity markets moved in sympathy with European markets. Real estate (XLRE) 44.68 +.13% and Basic Materials (XLB) 81.19 +.01% performed best on a relative basis. Communication Services (XLC) 79.76 -1.51% and Utilities (XLU) 63.89 -1.36% performed worst. Also, under pressure Financials (XLF) 38.63 -1.00% reacted to higher interest rates in Europe. Visa (V) 225.111 -2.24% and JPMorgan (JPM) 166.64) -2.10% were weakest in the DJIA ahead of earnings. Southwest Airlines (LUV) 51.67 -4.57% came under selling pressure as the company was forced to cancel more than 2000 flights over the weekend which the company blamed on weather and flight controller issues. No other major airline had similar problems. In retail, The Gap, Inc. (GPS) 22.08 -4.83% continued its steady downtrend since May. Pandemic lockdown beneficiary Etsy Inc. (ETSY) 202.34 -4.57% also came under selling pressure as Michaels Stores announced its entry into the digital space to market customer creations.
Tuesday, Oct. 12, 2021 – DIA 343.78 -.35%, QQQ 357.14 -.35%, SPY 433.62 -.25%, IWM 221.52 +.55%
No high-impact data was released on the day. Equity markets were quiet and on the soft side. The 10-year U.S. Note auction was well received and interest rates declined, and the 10-Year Note index (TNX) 15.80 -.34 declined. Real Estate (XLRE) 45.28 +1.34% outperformed for the second day, followed by Consumer Discretionary (XLY) 183.33 +.79%. Nike (NKE) 153.35 +2.04% led the DJIA on a Goldman Sachs initiated coverage of the company with a 'Buy’ and a $172 price target. The company’s shares recently tested the 200-day moving average and have rallied while the general market has remained weak. Communication Services (XLC) 79.02 -.93% was the weakest sector on the day, followed by Technology (XLK) 150.34 -.52% and semiconductor were most pronounced to the downside with Intel (INTC) 52.17 -2.38% the laggard in the DJIA and Micron Technology (MU) 66.72 -3.61% the weakest in the NDX 100. The company’s shares peaked above $95 in April and have been on a clear downtrend since that time. In computer hardware, HP Inc. (HPQ) 26.55 -4.08% the laggard of the S&P 500 on the day continued its downtrend after peaking near $36 in May. Software firm Citrix Systems (CTXS) 90.95 -3.94% caught a downgrade by William Blair which moved from ‘Overweight’ to ‘Market Perform’. On the upside and demonstrating clear strength, Online identity security firm OKTA, Inc (OKTA) 235.17 +4.12% led the NDX 100, followed by Cyber Security firm CrowdStrike Holdings (CRWD) 252.74 +3.43%.
Wednesday, Oct. 13, 2021 – DIA 343.89 +.11, QQQ 360.00 +.80%, SPY 435.18 +.36%, IWM 222.57 +.47%
The Consumer Price Index (YoY) for Sept. came in at 5.4% vs. the 5.3% expected. The number for month over month came in at .4% vs. the .3% expected. Equity markets were in consolidation mode with a positive bias for the majority of the day, until the FOMC minutes were released at 2 pm. Interest rates declined as exhibited by the 10-Year Note index (TNX) 15.49 -.31. As a result, financials (XLF) 38.29 -.57% were the day’s clear laggard. Utilities (XLU) 65.07 +1.17% outperformed on the decline in yields. Big cap technology stocks did well Salesforce.com (CRM) 284.41 + 1.94% led the DJIA. Cyber security firm OKTA, Inc. (OKTA) 247.20 +5.12% led the NDX 100 for a second straight day. Semiconductor firm Advanced Micro Devices (AMD) 109.16 +3.92% led the S&P 500. AMD will announce earnings on October 26th after market close. On the downside airlines came under selling pressure, Delta (DAL) 41.03 -5.76%, United (UAL) 47.88 -3.60%, American (AAL) 19.61% -3.35% all fell on a warning by Delta about fuel costs affecting earnings this quarter.
Thursday, Oct. 14, 2021 – DIA 349.13 +1.52%, QQQ 366.63 +1.84%, SPY 442.50 +1.68%, IWM 225.87 +1.48%
The Producer Price Index ex-food & energy (YoY) for Sept. came in better than expected +6.8% vs. 7.1%. Initial jobless claims came in at a pandemic low of 293K vs. the 319K expected. Equity markets were strong across the board from the opening. Interest rates continued to fall with the 10-Year note index (TNX) 15.19 -.30 down in yield. Basic Materials (XLB) 83.90 +2.43% led the S&P 500 followed by Technology (XLK) 154.67 +2.25%. Walgreen’s Boots Alliance (WBA) 50.77 +7.43% led the DJIA after beating earnings and revenue. On the call, the company covered growth initiatives in primary care, post-acute care, and home care. A standout in the energy space APA Corporation (APA) 26.22 +6.54% continued to act well ahead of earnings on November 3 (after market close). Cyber security firm OKTA, Inc. (OKTA) 255.53 +3.37% continued its advance. Semiconductor related names Intel (INTC) 53.90 +3.14%, Lam Research (LRCX) 567.93 +4.32%, NVIDIA Corporation (NVDA) 217.46 +3.85% moved higher.
Friday, Oct. 15, 2021 – DIA 352.85 +1.10%, QQQ 368.94 +.63%, SPY 445.87 +.76%, IWM 225.16 -.31%
Retail Sales (MoM) for September came in with much better than expected +.7% vs. -.2%. Ex- Autos were better as well .8% vs. .4%. Equity markets were mixed on the day, with market leadership in the DJIA and weakness in small caps. With a strong retail sales number, Consumer Discretionary (XLY) 189.01 +1.53% was the lead sector on the day, followed by Financials (XLF) 39.51 +1.49%. Goldman Sachs (GS) 406.07 +3.80%, Wells Fargo (WFC) 48.38 +6.78% was the second strongest stock in the S&P 500. Transportation stocks were strong with J.B. Hunt Transport Services (JBHT) 190.55 +8.74% running best in the S&P 500 as the company beat estimates on its earnings report. Aluminum producer Alcoa (AA) 56.00 +15.23% beat on earnings and revenue, jumping to new highs on the year. On the downside, Moderna (MRNA) 324.21 -2.31% continued its conspicuous weakness in the face of booster shot authorizations in the U.S. Reports circulated that the FDA might delay a decision on whether to authorize vaccinations for adolescents due to safety issues.
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