Mon. January 10, 2022 – DIA 360.79 -.42%, QQQ 380.11 +.07%, SPY 465.51 -.12%, IWM 215.32 -.35% CNN Fear/Greed Index 49 (Neutral)
No high impact data released on the day. Markets opened lower and worked even lower in the morning as interest rates climbed. The 10-Year (Yield) 17.80 +.09 Index initially climbed to 18.08 but settled below the headline 18 handle many were watching. The bullish action in interest rates sparked a rally in the major indexes which closed mixed but way off the lows of the day. Healthcare services (XLV) 135.73 +1.03% fared the best on the day. Vaccine maker Moderna (MRNA) 233.70 +9.28% led the NDX100 as the CEO was featured in business news channels speaking to progress being made in the company’s mRNA technologies and that a vaccine for Omicron would be available by March. HMO firm Humana (HUM) 385.18 +6.06 was the next strongest in the index. The stock had plummeted the week before as the company announced that the anticipated increase in sales of its Medicare Advantage plans would not meet expectations. Medical supply distributor Cardinal Health (CAH) 51.03 -5.92% fell in response to the company saying that inflation and supply chain issues would affect the firm’s performance in the current quarter. Technology (XLK) 166.05 +.02% performed second best in the S&P 500 sectors. Semiconductor firm Intel (INTC) 55.21 +3.31% led the DJIA. Network security software providers were strong on the day Zscaler (ZS) 275.65 + 5.4% and Fortinet (FTNT) 324.71 +3.19% both rallied strongly from recent weakness. Weighing on the DJIA, athletic apparel manufacturer and lifestyle marketer Nike (NKE) 150.44 -4.16% continued a recent downtrend on a downgrade by HSBC from “Buy” to “Hold” citing weak China sales.
Tue. January 11, 2022 – DIA 362.54 +0.49%, QQQ 385.82 +1.50%, SPY 469.75 +0.91%, IWM +1.06% CNN Fear/Greed Index 60 (Greed)
No high impact data released on the day. All eyes and ears were on Fed Chair Jerome Powell’s testimony before Congress. As the chairman spoke a relief rally ensued on what some commentators believed were somewhat dovish comments. The major indexes advanced throughout the day. WTI crude oil 81.46 + $3.23 advanced to post pandemic new highs. As a result, Energy Services (XLE) 63.23 +3.40% was the lead S&P 500 sector, with APA Corporation (APA 32.00 +8.77%, Occidental (OXY) 34.70 +7.16%, Hess Corporation (HES) 90.04, +5.74% Haliburton (HAL) 27.24 +5.38%, Marathon (MRO) 18.66 +5.19%, and EOG Resources (EOG) 102.20 +4.22% all outperforming. Chinese internet issues, JD.com (JD) 76.76 +10.29% and Pinduoduo (PDD) 60.02 +5.32% advanced from year end oversold levels. The stocks continue to be well off 52 week highs on the potential of being delisted due to financial reporting requirements being mandated by US regulators. Vaccine maker Moderna (MRNA) 221.39 -5.27% succumbed to profit taking on the previous day’s news related advance. The stock continues to be well off 52 week highs at $497.49 on August 10, 2021. The day’s outstanding performer was healthcare information technology provider Accolade (ACCD) 24.44 +27.69% which beat on earnings and revenue.
Wed. January 12, 2022 – DIA 363.13 +.16%, QQQ 387.35 +.40%, SPY 471.20 +.31%, IWM 216.06 -.71% CNN Fear/Greed Index 63 (Greed)
The Consumer Price Index came in as expected at a torrid +7% pace annualized. Ex-Food & Energy slightly higher than expected at +5.5% annualized. Markets moved higher as interest rates eased downward. The 10-Year Note (Yield) Index 17.25 -.21 fell sparking a relief rally in the major indexes. Basic Materials (XLB) 90.26 +1.01% led the S&P 500 sectors with copper miner Freeport-McMoRan (FCX) 45.15 +5.02% leading the group. Specialty steel producer Nucor (NUE) 114.72 +3.50% also outperformed. As interest rates were stable to lower big cap technology was also an outperformer. Semi-equipment manufacturer Applied Materials (AMAT) 159.55 +4.66% led the NDX100 followed by Tesla (TSLA) 1106.22 +3.93%. Enterprise customer relations software provider Salesforce.com (CRM) 237.83 +1.27% led the DJIA. On the downside, asset manager T. Rowe Price (TROW) 180.83 -6.63% reported assets under management of 1.688 Trillion up 15% from the prior year. The stock has been under selling pressure since hitting a high at 224.56 on August 30. Pandemic beneficiary medical testing firm Quest Diagnostics (DGX) 147.14 -6.80% announced preliminary earnings lower than the prior year’s quarter, but ahead of consensus estimates. The stock peaked recently on December 31 at 174.16. Also to the downside, and a pandemic beneficiary as well, interactive exercise equipment manufacturer Peloton (PTON) 34.49 -5.66% continued under pressure.
Thurs. January 13, 2022 – DIA 361.20 -.48%, QQQ 377.66 -2.50%, SPY 464.53 -1.38%, IWM 214.01 -.92% CNN Fear/Greed Index 51 (Neutral)
The Producer Price Index (YoY) came in at +9.7% vs. +9.8% anticipated. PPI Ex-Food & Energy (YoY) came higher than anticipated at +8.3% vs. 8.0% expected, the fastest pace of inflation since 1982. Initial Jobless Claims were reported at 230K higher than the 200K anticipated. Fed governor Lael Brainard testified before congress stressing that reducing inflation back down to 2% were at the forefront for the central banks efforts. Markets opened higher but were quickly sold off and gained steam to the downside on the Brainard headlines. Technology (XLK) 164.37 -2.59% was the hardest hit S&P 500 sector. Large cap technology names Microsoft (MSFT) 304.80 -4.23% and Salesforce.com (CRM) 228.63 -3.87%, and Apple (AAPL) 172.19 -1.90% led the DJIA to the downside. High multiple growth names came under pressure as well, with digital workflow software applications provider Servicenow (NOW) 521.26 -9.09% the worst performer in the S&P 500. High end electric car manufacturer Lucid Group (LCID) 41.41 -8.85% was the hardest hit in the NDX100, followed by security software providers Zscaler (ZS) 250.47 -8.58%, and Datadog, Inc. (DDOG) 135.13 -7.65%. Delta Airlines (DAL) 41.47 +2.12% beat on earnings and revenue and gave an upbeat outlook for recovery from the Omicron infection wave. Other travel & entertainment stocks fared well on that news, American Airlines (AAL) 19.34 +4.54%, Norwegian Cruise (NCLH) 23.11 +4.01% and United Airlines (UAL) 48.17 +3.50% all moved higher.
Fri. January 14, 2022 – DIA 359.14 -0.57%, QQQ 380.01 +0.62%, SPY 464.72 +0.04%, IWM 214.31 +0.14% CNN Fear/Greed Index 53 (Neutral)
Retail Sales reported down -1.9% MoM (Dec.) vs. flat expectations. Ex-Autos (Dec.) were even worse down -2.3% vs. a +.2% growth expectation. Michigan Consumer Sentiment reported at 68.8 weaker than 70 expectation as well. Markets opened lower on news reports of cyberattacks on Ukraine and poor earnings from JPMorgan (JPM) 157.89 -6.15% (a loan loss release and weak net interest income). Wells Fargo downgraded the stock from “overweight” to ”equal weight” on the news. Markets had a late session rally to mostly close positive with the exception of the DJIA. WTI crude oil 84.30 +$2.18 continued the week’s move to the top of the recent trading range from October. Energy Services (XLE) 64.51 +2.35% was the top performer, followed by Technology Services (XLK) 165.76 +.85% as second best. Casino stocks Las Vegas Sands (LVS) 42.99 +14.15% and Wynn Resorts (WYNN) 91.47 +8.6% topped the NDX100 performers as Macau announced its rules for operator licenses going forward. Semiconductor Equipment manufacturers were some of the better performers Lam Research 729.82 +6.27%, Applied Materials 167.00 +6.25%, and KLA Corporation (KLAC)445.00 +5.58% all higher.
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