Whoa, it happened again!  The market was lurching into freefall mode when buyers suddenly materialized yesterday at the one o'clock hour. Unlike the reversal we saw on Friday, growth stepped up to carry the load this time. 

The one-two punch of Communication Services (XLC) and Technology (XLK), with help from Health Care (XLV) (read Eli Lilly (LLY)), offset declines in the other eight sectors. 

Tech Carrying the Load

Technology (XLK) stocks have never been this influential to the overall market since during the dot.com era. 

The Technology Sector has been a locomotive, but the rate of change has slowed as fewer names are surging. 

Leadership & Breadth

Nvidia (NVDA) & Friends yesterday included cruise ship operators, pharmaceuticals (get ready for more vaccines), and Boeing (BA), which shook off rumors of hair deliveries in China.

The market breadth was essentially even, although the up volume was significantly higher than the low volume, suggesting buyers are earnest about buying dips.

Market Breadth	NYSE	NASDAQ
Advancers	1,317	2,097
Decliners	1,491	2,175
New Highs	132	104
New Lows	49	108
Up Volume	1.75 billion	3.35 billion
Down Volume	2.2 billion	1.98 billion

Speedy Economic Decline

On May 14, the Atlanta GDPNow tool saw the second quarter of 2024 (2Q24) Gross Domestic Product (GDP) at 4.2%. At the close yesterday, it was down to 1.8%.

Consumer spending was estimated to be 4.0%. Now, it’s 1.8%, while non-residential investment has declined to -4.0% from +5.8%, and residential has swooned to -4.4% from 2.0%.

More Economic Data On the Docket 

Today’s Session

Stocks look to open under pressure, yet again, setting up another test.

We are watching the bond market very closely.  It made a nice, but unheralded move. For stock investors, the ten-year yield under 4.5% has been a green light to own stocks. I think a move below 4.30% would be the signal to shift into an even higher buying gear.

This is still the longest bond rout and buying might be tentative despite all the bulls.

Tweet

 

Home | Products & Services | Education | In The Media | Help | About Us | Disclaimer | Privacy Policy | Terms of Use | All Rights Reserved.