Monday, Oct. 4, 2021 – DIA 340.01 -.92%, QQQ 352.62 -2.10%, SPY 428.64 -1.29%, IWM 220.26 -.91%
Factory Orders came in better than anticipated up +1.2% vs. +.9% expected. Equity markets gapped lower from the opening. Partisan wrangling over the budget and debt limit had continued over the weekend. Over the weekend as well the OPEC meeting ended with an agreement to slowly increase production back to pre-pandemic levels, which drove prices to a 7 year high. Energy Services (XLE) 54.72 +1.63% was the lead S&P 500 sector on the day: Devon Energy (DVN) 38.76 +5.30%, Diamondback (FANG) 103.38 +4.57%, Phillips 66 (PSX) 75.71 +4.33%, Marathon (MRO) 14.83 +4.14% all topped the S&P 500. Interest rates were stable to slightly higher as shown by the 10-Year index (TNX) 14.81 +.16%. Technology (XLK) 148.06 -2.32% was the hardest hit sector, with Twitter (TWTR) 58.39 -5.79% the worst-performing stock in the S&P 500 breaking down from a wedge pattern. Digital security cloud software company Okta Inc. (OKTA) 224.96 -5.51% led the NDX 100 lower, followed by internet-based athletic gear and content provider Peloton (PTON) 82.35 -5.03, challenging its 52-week lows.
Tuesday, Oct. 5, 2021 –DIA 343.13 +.92%, QQQ 357.38 +1.35%, SPY 433.10 +1.04%, IWM 221.02 +.35%
ISM Services Employment Index (SEP) came in weaker at 53 vs.53.7 expected. ISM Services Prices Paid index came in lower than expected at 77.5 vs. 79.3. Concern over the debt limit and continuing budget impasse appeared to lift as Sen. Joe Manchin was perceived to move closer to a deal on the legislation. Sparking a rally for a turnaround Tuesday. Interest rates moved higher with the 10-Year Note Index (TNX) 15.29 +.48 climbing which led to Financials (XLF) 38.56 +1.96% as the top-performing sector on the day: Goldman Sachs (GS) 385.51 +3.12% lead the DJIA. Video streaming leader Netflix (NFLX) 634.81 +5.21% had favorable comments made by Cowen & Co. bringing the stock to a new high. Cryptocurrency bank and crypto payments systems provider Silvergate Capital (SI) 153.00 +12.58% moved higher for a 5th straight day while breaking to a 6-month high. On the downside, retail chain Ross Stores (ROST) 108.32 -1.71% continued its decline challenging 52-week lows amid industry-wide supply chain concerns.
Wednesday, Oct. 6, 2021 – DIA 344.12 +.29%, QQQ 359.67 +.64%, SPY 434.90 +.42%, IWM 219.87 -.52%
ADP Employment Change (Sep) came in strong +568K vs. +428K expected. The US Senate came closer to resolving, at least temporarily, the federal debt limit. President Putin of Russia made public statements that natural gas would indeed flow to Ukraine this heating season, which relieved the anxiety of shortages in Europe. As a result, oil and natural gas prices subsided in controlled profit-taking. Energy Services (XLE) 54.46 -1.05% was the laggard performer with Devon (DVN) 38.68 -3.49% and NOV Inc (NOV) 13.71 -3.38%. President Biden and President Xi of China were said to be arranging talks although by video conference. Equity markets were mostly positive on the day. Interest rates were stable with the 10-Year Note index (TNX) settling at 15.24 -.05. Utilities (XLU) 65.60 +1.55% was the lead sector, followed by Consumer Staples (XLP) 69.82 +.97% both defensive sectors. Moderna (MRNA) 302.42 -8.94% came under selling pressure as news hit that Sweden would halt the use of the firm’s vaccine for people under the age of 30. On the upside, smart lighting and intelligent building design company, Acuity Brands (AYI) 195.55 +10.90% broke out to new highs on a top and bottom-line beat on earnings with margin improvement.
Thursday, Oct. 7, 2021 – DIA 347.63 +1.02%, QQQ 362.97 +.92%, SPY 438.66 +.86%, IWM 223.26 +1.54%
Jobless Claims came much better than expected at 326K vs. 348K. While the US Senate came to an agreement to lift the national debt limit by $480 Billion enough to fund the government until December. Equity markets cheered and were broadly higher on the day as a result, but still flirted with resistance. Consumer Discretionary (XLY) 183.47 +1.56% was the lead sector: Ebay Inc. (EBAY) 74.17 +3.68%, followed by Healthcare Services (XLV) 127.58 +1.33%. In the wake of the announcement Wednesday that President Biden and President Xi of China had scheduled talks, China-related shares outperformed on the day: NetEase (NTES) 96.06 +8.29%, Pinduoduo (PDD) 94.95 +6.30%, JD.com (JD) 76.30 +6.16%, and Baidu (BIDU) 156.55 +4.81% were the top four stocks in the NDX 100. Utilities (XLU) 65.25 -.53% were the clear laggard, with Pinnacle West (PNW) 68.19 -8.07% selling off on a Guggenheim downgrade from ‘Buy’ to ‘Sell’ and lowering of price target from $97 to $58. The day’s stellar performer, New Fortress Energy (NFE) 33.26 +25.51% hosted an investor update where it discussed its natural gas supply while boosting fourth-quarter guidance and goals for 2022.
Friday, Oct. 8, 2021 – DIA 347.53 -.03%, QQQ 361.16 -.50%, SPY 437.86 -.18%, IWM 221.58 -.75%
Non-Farm Payrolls (SEP) disappointed coming in at 194K vs. the 500K expectation. Labor Force participation declined slightly to 61.6%. Average hourly earnings improved to +.6% vs. the prior and expected +.4%. The U6 Underemployment reading improved markedly to 8.5% from the expected 9%. Equity markets were flat to down on the day. The US Department of Energy indicated that it would not release oil from the strategic oil reserve or SPR at the present time. WTI crude prices continued to rally settling at $79.50 +1.53% hitting highs not seen since 2014. Energy Services (XLE) 56.57 +3.08% was the lead sector on the day, with Chevron (CVX) 108.05 +2.24% topping the DJIA, While APA Corporation (APA) 24.36 +6.84%, Hess (HES) 89.15 +6.63%, EOG Resources (EOG) 90.53 +5.53%, and ConocoPhillips (COP) 74.92 +4.77% dominated the S&P 500. China-related shares continued to respond to the prospect of better US/China relations. Baidu (BIDU) 162.09 +3.54% and JD.com (JD) 78.61 +3.03% both topped the NDX 100. The day’s upside rocket was ChemoCentryx (CCXI) 38.41 +95.97% as the FDA approved its drug, Tavneos, for ANCA-associated vasculitis therapy.
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