Post Number: 3436
Posted From: 22.214.171.124
Votes: 0 (Vote!)
|Posted on Monday, March 15, 2021 - 1:57 pm: ||
A slow start to the week. Keep airlines on the radar as major domestics are presenting at the J.P. Morgan Industrial Conference today. The group is coming into key resistance as these comments cross wires. I am watching JETS for a possible trade. I expect a slow start to the week. The big event is Wednesday when the Fed updates its economic outlook and Powell addresses the markets and this rise in the 10-year. I will have more to say on this event as we get closer. Overall, I think the markets will drift in a tight range until the headline risk passes.
Yellen on taxes- Ms. Yellen said that the Administration would consider the merits of a wealth tax. She was clear that the Administration did not propose such a tax. Yellen said that the Administration would take steps to address the mounting debt. The assumption is she is referencing corporate taxes. I will be on at 11am ET with Policy Analyst Carmine Atteo to discuss.
JETS- Watch airlines this morning as UAL, AAL, and DAL present at the J.P. Morgan Industrial Conference today. The three companies make up approximately 30% of the JETS ETF. Many airlines prepare to test key resistance levels. Comments on the trends will determine if this group can move above resistance as vaccine roll outs continue.
U.S. Global created the JETS ETF. The top four domestic airlines (above plus LUV) is 42% of the weighting which is by design. LUV is the fourth 10%+ name. This morning it stated that it continues to experience significant negative impacts to passenger demand and bookings due to the COVID-19 pandemic; performed in-line with the co's expectations in February 2021.
China Econ Data- China's Jan-Feb Industrial Production 35.1% yr/yr (expected 30.0%; last 7.3%); Jan-Feb Retail Sales 33.8% yr/yr (expected 32.0%; last 4.6%); Jan-Feb Fixed Asset Investment 35.0% yr/yr (expected 40.0%; last 2.9%); February Unemployment Rate 5.5% (last 5.2%); February House Prices 4.3% (last 3.9%). We see the impact of the easier y/y comps. Overall the data was mixed which reflects some of the price action we are seeing in markets.
German Elections- Watching this play out as we prepare for Angela Merkel to step down. The CDU lost elections in regional contests due in part reportedly to anger about the pace of vaccine rollout, raising questions about the CDU retaining the Chancellor position come the September elections. The CDU lost the Baden-Wurttemberg region, a major industrial powerhouse, and the Rhineland Palatinate regions. German National elections are in September when Angela Merkel steps down from her chancellorship after a 16-year run.
Goldman was out with a note that stocks would be able to handle a 10-year yield around 2%.
DKNG- DraftKings announces its intention to offer $1 billion aggregate principal amount of convertible senior notes due 2028. Stock gives up some of its gains from last week. I would look to add on any weakness.
Empire Manufacturing- A small beat in the Empire. A big week on the sentiment front. The major story will be the Fed on Wednesday.
Post Number: 3390
Posted From: 126.96.36.199
Votes: 0 (Vote!)
|Posted on Friday, March 05, 2021 - 1:12 pm: ||
TALKX Market Briefing: selling into early strength
The stock market started today on a strong note, seemingly heartened by the arrival of a stronger than expected February employment report that featured a 379,000 increase in nonfarm payrolls and a 465,000 increase in nonfarm private payrolls. The strength has not persisted, however, for a variety of reasons:
With the leisure and hospitality industry accounting for 355,000 nonfarm payrolls, a closer look at the report suggests the nonfarm payrolls strength wasn't as "strong" as it appeared at first blush.
Early strength in many of the growth/momentum stocks has been sold into, fostering concerns that the correction in these names has not run its full course.
The 10-yr note yield is off its post-report high of 1.61%, but at 1.57%, it is still higher than yesterday's settlement level (1.55%) and serving as an anxious focal point for the stock market.
Mega-cap issues like Tesla (TSLA 575.00 , -46.44, -7.5%), Apple (AAPL 119.00, -1.12, -0.9%), and Amazon.com (AMZN 2940.21, -37.36, -1.3%) continue to hang like a wet blanket on the broader market.
Overall, there isn't any strong conviction on the part of buyers. A market that typically responds well to episodic drops below support at the 50-day moving average has yet to act as well as expected. The S&P 500 for its part fell below its 50-day moving average (3820) yesterday while the Nasdaq Composite yesterday notched its fourth close below its 50-day moving average (13,337) in the past six sessions.
One area that continues to run, however, is the S&P 500 energy sector (+2.7%). It is the best-performing sector again today and is now up 37.0% year-to-date. Conversely, the consumer discretionary sector (-1.9%), which houses Amazon and Tesla, is today's biggest laggard and one of the biggest laggards to date with a 5.9% decline.
The Dow Jones Industrial Average is up 0.2%; the S&P 500 is down 0.2%; the Nasdaq Composite is down 1.2%; and the Russell 2000 is down 1.4%.