A journey of a million miles begins with the first step. Yesterday, the market put the brakes on its slide, but the internals weren’t great. Only 36% of the names were higher.

Four sectors were lower, led by Consumer Staples (XLP), which looked like someone yelled “fire!” in a crowded theater. That’s the problem with safe havens - the first glimpse of ‘hot’ sees them empty out quickly. In this case, investors returned to the “Mag Seven” names that became de facto safe havens.

Trump Bump

Perhaps President Trump could buy a new Tesla (TSLA) every day. The “Mag Seven” made a monster rebound, with Apple (AAPL) conspicuously missing.

Better Breadth

Market breadth was encouraging, but there is a long way to go. The big buy signal comes when new highs eclipse new lows.

Factors were spotty, reflecting an investor’s appetite to get back in the high fliers, as well as for slower quality names.

Today’s Session

The Producer price index (PPI) was better than expected, but immediately, the financial media told everyone to ignore the numbers.

If it were hotter, the news would have been devastating. 

A new narrative emerging is the death of the buy the dip trade. Interestingly, the article in Bloomberg used charts that underscore the fact there have been larger dips over the past decade.