Monday, March 1, 2021 – DIA 315.59 +1.98%, QQQ 323.59 +3.01%, SPY 389.58 +2.42%.
Markit Manufacturing PMI far better than expected 60.8 v. 58.8, as well as, the Markit Manufacturing Employment 54.4 v. 53. ISM Manufacturing Prices came in blistering hot above expectations 86 v. 80. Markets rebounded from the previous session's dismal performance. Technology (XLK) 134.90 +3.22% and Financials (XLF) 33.33 +3.13% led the market. Inflation and higher rates have spooked the markets recently but today there was no fear of buying as the market gapped higher and ran all day Monday. DENTSPLY Sirona (XRAY) 59.71 +12.51% popped after beating earnings as the dental market showed signs of recovery after the lockdowns. Etsy, Inc. (ETSY) 244.58 +11.04% beat earnings on Friday and today broke out to new highs in extremely bullish action. Groupon (GRPN) 56.75 +32.56% gapped higher and broke out post-earnings as JPMorgan upgraded the shares from underweight to neutral.
Tuesday, March 2, 2021 – DIA 314.19 -.44%, QQQ 318.4 -1.60%, SPY 386.54 -.78%
No meaningful data released on the day. Markets showed promise early but faded to the downside late in the day with Technology (XLK) 132.76 -1.59% and Consumer Discretionary (XLY) 163.03 -1.15% leading to the downside. The only sector to show a positive return was Basic Materials (XLB) +.56%. Lockdown favorite Zoom (ZM) 372.79 -9.00% had better than expected earnings, but the stock reversed after an initial pop. In another case of a lockdown favorite being sold off on the better than expected earnings Target (TGT) 173.49 -6.77%. With better news on the diminishment of the COVID-19 infection rates, cruise ship stalwarts Carnival (CCL) 27.59 +4.87% and Norwegian (NCLH) 31.18 +4.46% continued higher.
Wednesday, March 3, 2021 – DIA 312.99 -.38%, QQQ 312.99 -2.9%, SPY 381.42 -1.32%
ADP Employment came in much lighter than expected +117K jobs v. 177K. ISM Services PMI was light as well 55.3 v. 58.7. ISM Services prices paid came in a whopping 71.8 v. 64.7 expected. The markets were mixed at the open, then the NASDAQ accelerated to the downside. For the second day in a row Technology (XLK) 129.42 -2.52% and Consumer Discretionary (XLY) 159.20 – 2.35% got hit hardest. Big names Salesforce.com (CRM) 206 -3.5%, Microsoft (MSFT) 227.56 -2.70% got hit hard, while Energy (XLE) 49.85 +1.47% and Financials (XLF) 33.46 +.78% showed the best performance. Diamondback Energy (FANG) 74.44 +4.83% had a nice day considering the overall tone of the market. Pandemic lockdown favorite Etsy (ETSY) 208.61 -12.51% reversing all of Monday’s gains and then some.
Thursday, March 4, 2021 – DIA 309.58 -1.34%, QQQ 304.10 -1.64%, SPY 376.70 -1.24%
Initial Jobless claims came in as expected but still elevated @ 745K. Initial Jobless claims came in elevated but slightly better at 790.7K. Non-Farm Productivity -4.2%, while Unit Labor Cost rose by 6%. The implications of these numbers have some fearing a potentially stagnant inflationary economy. Equity markets sold off hard after remarks by Fed chairman Powell that DID NOT address concerns about rising long-term rates. The indexes recovered late in the day. Again, Energy (XLE) 51.04 +2.39% was the lead sector as OPEC signaled the supply would stay tight via production cuts, Today's biggest losers included technology (XLK) 126.56 -2.21%, and Consumer Discretionary (XLY) 155.83 -2.12%. One bright spot continues to be Diamondback (FANG) 81.26 +9.16% which again led the energy sector higher. The day's moon shot was Five Prime Therapeutics (FPRX) 38.00 +78.74% which struck a deal to be acquired by Amgen (AMGN).
Friday, March 5, 2021 – 315.24 +1.83%, QQQ 308.68 +1.51%, SPY 383.63 +1.84%
Non-Farm Payrolls came in much better than expected 379K v. 182K. The unemployment rate ticked down to 6.2% while the U6 underemployment rate remained at 11.1%. Equity markets gyrated in synch with the 10-year treasury rate. The 10 Year index (TNX) ticked as high as 16.26 before finally closing at 15.54. All-day long we saw a correlation and as the 10-year rate would drop, equity markets would rebound. Energy (XLE) 52.95 +3.74% continued to be the week's star performer. Industrials (XLI) 93.44 +2.37% also shined. Formerly National Oilwell Varco now NOV, Inc. (NOV) 17.29 +12.13% was the best performer in the S&P500 index. Energy names continued to outperform and be on fire. Winners include Apache (APA) 23.25 +10.82%, and Devon Energy (DVN) 25.61 +8.43%. The cruise lines came under selling pressure after Norwegian (NCLH) 28.85 -12.31% priced a secondary offering (causing dilution) and the news hit the sector hard; Royal Caribbean (RCL) 86.51 – 5.57%, and Carnival (CCL) 26.09 -4.78%. Theater company Imax Corp. (IMAX) 24.59 +18.73% broke out to new highs. Although the company reported a loss (which was expected), the earnings call was upbeat on the future and imminent theater reopenings.
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