The Bear Den by Shortside Jonny
Monday, December 28, 2020 – DIA 304.00 +.66%, QQQ 312.68 +1.01%, SPY 372.17 +.86%
No major data released. Trump signed the omnibus bill that included the 600 dollar relief to Americans hit by the shutdowns. The major indexes all hit record highs for the year, as the traditional “Santa Clause Rally” took hold. The NASDAQ outperformed on the day. Three economic reopening plays advanced, ULTA Beauty (ULTA) 278.17 +5.11% moved higher on a large bar from a 3-week pullback in price. Work uniform provider Cintas (CTAS) 354.19 +4.67% traded higher and approached its 52-week high and Ross Stores (ROST) 122.62 +3.90% moved to a new high. Risk and data analytics leader Verisk (VRSK) 207.98 +3.35% set a new high. On the downside, lockdown play Zoom (ZM) 351.39 -6.34% continued in a decline from the all-time high posted on October 19th. Electronic agreement platform provider DocuSign (DOCU) 229.20 -6.42% had a large bar down day. COVID-19 vaccine provider Moderna (MRNA) 111.40 -9.72% continued its decline from the December 1st high of 178.5.
Tuesday, December 29, 2020 – DIA 303.46 -.18%, QQQ 312.96 +.09%, SPY 371.46 -.18%
The Case-Shiller Home Price index showed an increase of +7.9% vs. an expected +6.9% up from the prior number of 6.6%, demonstrating that the Fed strategy of purchasing $120 billion in government and mortgage-backed securities per month has had the desired effect on asset prices such as the nation’s housing stock. The market opened strongly across the board but faded as the day went by. Reacting to pressure by Third Point, an activist hedge fund, to restructure the company, Intel (INTC) 49.39 + 4.93% moved higher leading the DJIA (DIA). Chinese internet firm JD.com (JD) 86.14 +5.55% advanced to lead the Nasdaq 100 (QQQ). On the downside data storage device firm Western Digital (WDC) 48.29 -3.54% continued its pullback in price from its December 18 high.
Wednesday, December 30, 2020 – DIA 304.13 +.22%, QQQ 312.97 flat, SPY 371.99 +.14%
Pending Home Sales for November MoM came at -2.6% vs. a flat estimate in a continued sign of the housing market may be cooling. The market opened higher on the day but cooled once again towards the end of the trading session in dull holiday trading. Baidu (BIDU) 219.63 +12.59% broke to a new high after a 2-week high consolidation on news of a pending trade agreement between China and the European Union. Commodity and materials stocks are showing strength. Copper miner Freeport-McMoRan (FCX) 26.53 +7.24% broke out to a new high after a 3-week consolidation. Energy firm Diamondback (FANG) 49.27 +4.83% advanced after a pullback from a recent 6 months high.
Thursday, December 31, 2020 – DIA 305.79 +.55%, QQQ 313.74 - .77%, SPY 373.88 +.51%
Initial Jobless Claims fell to 787K lower than the 806K expected. The 4-week average remained elevated at 837K. Continuing claims were slightly better than expected 5.219M vs. 5.39M. The Dow (DIA) and S&P 500 index (SPY) both closed at records to end the year. Western Digital (WDC) 55.39 +11.83% advanced from a 2-week pullback to hit a 9 month high on notable volume. DXC Technologies (DXC) 25.75 +5.79% advanced to a 9 month new high as well. On the downside were a mixture of the pandemic winner and loser stocks, energy firms Occidental (OXY) 17.31 -3.35% and Apache (APA) 14.19 -2.61%, airlines United (UAL) 43.25% -3.14% and American (AAL) 15.77 -2.35%, and Electronic agreement platform provider DocuSign (DOCU) 222.30 -1.59%, and home builder Lennar (LEN) 76.23 -2.31
Friday, January 1, 2021 – New Year’s Day markets closed.
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