Monday, August 9, 2021 – DIA 351.15 -.27%, QQQ 368.73 +.18%, SPY 442.13 -.08%, IWM 222.16 -.55%
No high-impact data was released on the day. Markets were mixed with strength in large-cap tech and weakness in small caps, as traders and investors considered the strong jobs report on Friday and the continued surge in the C-19 Delta variant. In the overnight market, Gold plunged $85.6 to a low of $1677.9 (down -5.8%) before recovering to close in the top of the range at $1731.6 by the end of the regular session. WTI crude oil for September delivery closed the day down as well at 66.84 -2.11%. As a result, the Energy Sector (XLE) 48.81 -1.80% moved down in sympathy. The Healthcare Sector (XLV) 133.45 +.38% led the S&P 500, with Moderna (MRNA) 484.47 +17.10%, bolting higher after it received approval by Australia Therapeutic Goods Administration to provide up to 25mm doses of its COVID-19 vaccine by 2022. In addition, news that booster shots would most likely be needed in the near future added to the demand for the shares. In another big move higher, biotech Cortexyme (CRTX) 98.91 +47.32% released unexpected positive data on its drugs ADAS-Cog11 and ADCS-ADL for Alzheimer’s. Also in biotech and on the downside, Axsome Therapeutics (AXSM) 27.37 -46.50% gave a disappointing regulatory update on its developmental drug AXS-205 for depression. In M&A news, Golden Nugget Online (GNOG) 18.50 +50.77% agreed to be acquired by DraftKings (DKNG) 52.36 +1.49%.
Tuesday, August 10, 2021 – DIA 352.73 +.45%, QQQ 366.84 -.51%, SPY 442.68 +.12%, IWM 222.6 +.20%
NonFarm productivity came in less than expected at +2.3% v. +3.5%. Unit Labor Costs grew slightly less than expected +1% v. 1.1%. For a second day markets were mixed again, with weakness in technology. The Energy Sector (XLE) 49.67 +1.76% led the market as WTI crude rebounded $68.50 + $2.02. Followed by Basic Materials (XLB) 85.31 +1.51%, with steel producer Nucor (NUE) 118.10 +9.58% breaking out to an all-time-high as traders and investors anticipated the passage of the $1.2 Trillion non-partisan infrastructure bill before the Senate. Heavy construction machine manufacturer Caterpillar (CAT) 214.07 +2.48% led the DJIA higher as it too would be a beneficiary of the legislation. Railroad operator Kansas City (KSU) 289.75 +7.47% jumped on reports that Canadian Pacific Railway (CP) 72.21 -.69% would revise its bid for a merger. On the downside, Semiconductor Manufacturers were hit as a group with Lam Research (LRCX) 617.17 -3.64%, Applied Materials (AMAT) 138.06 -2.77%, and KLA Inc. (KLAC) 342.00 -2.71% all falling. (As a group they have been relative strength laggards since the spring).
Wednesday, August 11, 2021– DIA 354.94 +.63%, QQQ 366.21 -.17%, SPY 443.78 +.25%, IWM 223.69+.49%
The Consumer Price index (MoM) came in as expected at .5%, ex-Food & Energy was better than expected at +.3% v. +.4%. CPI (YoY) reported in at +5.4% v. +5.3% expected. CPI ex-Food & Energy came as expected at 4.3%. The 10 year US Treasury Note auction went well. Both the DJIA and the S&P 500 indexes hit new highs. Basic Materials (XLB) 86.51 +1.41% continued to lead the S&P500 on the back of the passage of the 1.2T Infrastructure bill. Caterpillar (CAT) 221.66 +3.55% continued to lead the DJIA higher. Steel manufacturer Nucor (NUE) 122.72 +3.91% moved higher again. Moderna (MRNA) 385.33 -15.64% fell for a 2nd-day in a retreat from Monday’s price spike, giving back all the gains and then some. A big mover on the day, artificial intelligence lending platform Upstart Holdings (UPST) 170.11 +26.18% beat on top and bottom lines by a wide margin and received an upgrade by Citibank which moved from ‘Neutral’ to ‘Buy’ while raising the price target from $120 to $205. On the downside, specialty car leasing and sales company to the on-demand ride space, HyreCar Inc. (HYRE) 9.85 -48.48% reported faster growth than expected, but expenses and losses were higher than expected as well.
Thursday, August 12, 2021- DIA 355.23 +.08%, QQQ 367.53 +.36%, SPY 445.11 +.30%, IWM 223.16 -.24
Initial Jobless Claims came in as expected at 375K. The Producer Price Index Ex-Food & Energy came in much higher than expected +6.2% v. +5.6%. The major indexes exhibited a low volatility grind higher to new all-time highs for both the DJIA and the S&P 500. Mid-afternoon the 30yr Treasury Note auction was disappointing as the bid came in higher in yield / lower in price than where the bond had traded at auction time on a when-issued basis. The 10 Year Note Index (TNX) 13.67 +.28 reflected the backup in rates. Healthcare (XLV) 132.86 +.79% was the lead sector on the day, with broad participation in the sector. Followed by Technology (XLK) 154.15 +.57%, with Salesforce.com (CRM) 248.39 +2.52% leading the DJIA on the day, followed by Apple (AAPL) 148.89 +2.08%. The shares of Apple hit an all-time high of 150 on July 15th and have been consolidating since. Semiconductor and semiconductor equipment manufacturers continued to demonstrate weakness as Micron (MU) 70.25 -6.37% moved lower along with Applied Materials (AMAT) 129.22 -4.15%, KLA Inc. (KLAC) 328.51 -4.13%, Lam Research (LRCX) 583.51 -4.11%.
Friday, August 13, 2021- DIA 355.39 +.05%. QQQ 368.82 +.35%, SPY 445.92 +.18%, IWM 221.13 -.91%
The Michigan Consumer Sentiment Index (Aug.) plunged to 70.2 v. the prior and the expected number of 81.2. The lowest level since 2012. The major indexes had an upward bias on the day, but trading was listless. Small caps fared the worst down nearly a percentage point. Interest rates declined as exhibited by the 10-year note index (TNX) 12.97 -.70 moving lower. A defensive shift and risk-off tenor was evident in the internals of the market. Consumer Staples (XLP) 72.51 +.83% was the lead sector, with Tyson Foods (TSN) 81.91 +2.34%, Phillip Morris (PM) 101.59 +1.58%, Mondelez (MDLZ) 63.36 +1.55%, all moving higher. WTI oil moved lower with the front-month dropping to 67.94 off -1.15. As a result, the Energy Sector (XLE) 49.42 -1.18% performed the worst on the day with Apache (APA) 17.88 -5.50%. Diamondback (FANG) 75.64 -4.70%. Occidental (OXY) 25.79 -4.02% taking the hit to price. Financials were under selling pressure by the drop in rates with American Express (AXP) 166.08 -1.45%, JPMorgan (JPM) 159.98 -1.12% and Goldman Sachs (GS) 410.78 -1.02%. In M&A news, food processing company Pilgrim’s Pride (PPC) 27.34 +20.55% moved higher as JBS (JBSAY) 11.92 -.50% indicated interest in acquiring all the shares of the company not already owned.
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