The market continued its new ‘winning ways,’ with fresh sectors leading. Yesterday, Energy (XLE) was the top sector, although Industrials (XLI) was at the top of the list of advancers.

The top ten movers didn’t see any Technology (XLK) names. Believe it or not, this is good news.

Heat Map

The large squares and rectangles were mixed on the Heat Map, but there were no disasters.

Banks rebounded, and construction equipment makers (we are looking at you, Caterpillar (CAT)) continued to surge.

Breadth

It was a banner session in all facets of market breadth. I’m particularly impressed with the swoon in new lows for the New York Stock Exchange (NYSE) and the NASDAQ Composite.

Most of the action is still in the NASDAQ, as the NYSE had thin volume.

Orderly Retreat or Investing Utopia

Small-caps dominated again, but not at the expense of large-caps. I do not think this will be the template, as money moves quickly and demands immediate satisfaction.

Hedge funds have been aggressive sellers of Technology, Media, and Telecommunications (TMT). This means the risk-reward ratio has been altered dramatically, even if the rest of Wall Street does the ‘happy dance’ over TMT.

Today's Session

Retail sales were flat in June beating the consensus estimate of -0.3% m/m; however, it did increase 2.3% from June 2023. In addition, May retail sales were revised higher to an increase of 0.3% compared to the prior reading of 0.1%.

Gas and auto sales were largely responsible for no m/m growth, as June sales, excluding auto and gas, rose 0.8% compared to the estimates of 0.2%.