Mon. January 17, 2022 – MLK Federal Holiday (Markets Closed)

Tue. January 18, 2022–DIA 353.85 -1.47%, QQQ 370.55 -2.49%, SPY 456.49 -1.77%, IWM 207.83- 3.02% CNN Fear/Greed index 52 (Neutral)
No high impact data released. Markets gapped lower in reaction to interest rates moving higher; the 10-year Note (Yield) Index (TNX) 18.65 +.93 moved above previous resistance. The dollar index (DXY) 95.252 +.52% moved higher as well. Technology Services (XLK) 161.78 -2.40% fell hardest on the day followed by Financial Services (XLF) 39.92 -2.23%. Goldman Sachs (GS) 354.40 -6.97% and JPMorgan (JPM) 151.27 -4.19% led the DJIA to the downside, followed by Cisco Systems (CSCO) 59.73 -2.66% and Microsoft (MSFT) 302.65 -2.43%. Leading the NDX100 to the downside, vaccine developer Moderna (MRNA) 186.61 -8.85% came under pressure as a study from Israel called into question the efficacy of additional booster shots in relation to Omicron. Outperformers from 3Q21 in the semiconductor space came under profit taking: Applied Materials 152.36 -8.77%, KLA Inc. (KLAC) 412.98 -7.20%, Lam Research 679.01 -6.96%, and Marvel (MRVL) 77.67 -6.42%. Showing continued relative strength and the only positive S&P 500 sector on the day, Energy Services (XLE) 64.77 +.40% moved higher on strength in WTI Crude prices 85.57 +$2.27, with ExxonMobil (XOM) 73.08 +1.68% and Occidental 36.03 +1.46% the best performers. In a significant M&A deal, electronic gaming and multi-media company Activision Blizzard (ATVI) 82.31 +25.88% agreed to a buyout from Microsoft for $69 billion in cash.

Wed. January 19, 2022 – DIA 350.45 -.96%, QQQ 366.48 -1.10%, SPY 451.82 -1.02%, IWM 204.45 -1.63% CNN Fear/Greed 60 (Greed)
Building Permits for Dec. (MoM) came in better than expected at 1873K vs. 1712K. Housing Starts for Dec. (MoM) came in better than expected as well at 1702K vs. 1650K. The major indexes were higher while vacillating most the day but succumbed to a late session selling squall. Interest rates were higher most of the day but also fell on the weakness in equity prices late in the day. The 10-Year Note (Yield) Index 18.27 -.38 moved lower. Consumer Discretionary (XLY) 189.32 -1.80% fared the worst in the S&P 500 Sectors, followed by Financial Services (XLF) 39.25 -1.68%. Ford (F) 22.45 -7.92% fell on an announced a pre-view on certain accounting adjustments. US Bank (USB) 57.37 -7.75% fell on a miss on earnings and was downgraded by Keefe Bruyette from “Outperform” to “Market Perform”, and State Street (STT) 93.88 -7.06% beat earnings but fell hard. Bank of New York Mellon (BK) 59.24 -5.85% beat earnings as well but stated costs were rising. On the plus side, electronic gaming and multimedia software maker Take-Two Interactive (TTWO) 163.36 +6.05% moved higher after an upgrade by Exane BNP-Paribas from “Neutral” to “Outperform” and some speculation that Meta Platforms (FB) might have to respond to the Microsoft acquisition of Activison Blizzard.

Thurs. January 20, 2022 – DIA 347.33 -.86%, QQQ 361.72 -1.30%, SPY  446.75 -1.11%, IWM 200.75 -1.81% CNN Fear/Greed Index 52 (Neutral)
Initial Jobless Claims reported in at 286K up from the expected 220K. The Philadelphia Fed Manufacturing Index reported in stronger than expected at 23.2 vs. 19.8. Markets gapped higher on a rate cut by the Central Bank of China, but throughout the day weakened going negative late in the day. The NASDAQ was up better than 2.00% in the morning only to close down -1.34%. Such action is a hallmark of bearish markets. Consumer Discretionary (XLY) 185.87 -1.82% was the worst performing sector, followed by Basic Materials (XLB) 86.14 -1.45%. Home Depot (HD) 349.58 -2.81% was the worst performer in the DJIA. Former pandemic favorite, interactive fitness equipment manufacturer Peloton (PTON) 24.22 -23.93% plunged on a report the firm was planning a staff reduction and a pause to production.  Although negative on the day, Financial Services (XLF) 39.00 -.64% performed the best of the 11 S&P 500 economic sectors. Insurance firm Travelers Companies (TRV) 165.18 +3.19% was the top issue in the DJIA after beating on earnings, while Morgan Stanley (MS) 99.83 +4.28% beat earnings as well. But M&T Bank Corporation (166.35) -5.44% fell after posting a beat on earnings topping the S&P 500. On the upside, tumor fighting medical device company Novocure (NVCR) 70.10 +9.22% received an upgrade by Truist from “Hold” to “BUY” keeping its target price at 125.00. The stock has been a decline from June 24, 2021 when the shares traded at 232.76.

Fri. January 21, 2022 – DIA 342.35 -1.36%, QQQ 351.69 -2.77%, SPY 437.98 -1.96%, IWM 196.99 -1.87% CNN Fear/Greed Index 41 (Fear)
No high impact data released on the day. Markets gapped lower in continued technically driven selling. An early morning rally attempt was turned back decisively, and the major indexes succumbed to significant sell programs throughout the rest of the session. There were at least 37 tick readings larger than -1000. Of the 11 S&P 500 sectors Communication Services (XLC) 72.22 -3.38% fared worst. Video streaming service Netflix (NFLX) 397.50 -21.97% plunged after disappointing subscriber growth on its earnings report. Disney (DIS) 137.38 -6.94% the worst performer in the DJIA fell in reaction to the Netflix news. Interactive fitness equipment manufacturer Peloton (PTON) 27.06 +11.73% bounced from the previous session’s plunge. Dividend paying low beta stocks which had been much out of favor during the bull market caught buying. McDonalds (MCD) 254.59 +.58% topped the DJIA, followed by Proctor & Gamble (PG) 162.62 +.38. In a clear rout, enterprise software developer MicroStrategy (MSTR) 375.89     -17.84 shares fell on the news that the SEC had rejected the accounting for the company’s Bitcoin holdings.

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