Monday, Oct. 18, 2021 – DIA 352.5 -.10%, QQQ 372.65 +1.01%, SPY 447.19 +.30%, IWM 225.03 -.6%
No high-impact data was released on the day. Markets were mixed with an upside bias. Consumer Discretionary (XLY) 191.32 +1.22% was the lead sector on the day, followed by Technology (XLK) 157.23 +.85%. The clear laggard on the day was Utilities (XLU) 65.05 -.96%. Technology hardware, software, and cybersecurity solutions provider CDW Corporation (CDW) 186.23 +4.79 (earnings release 11/3 BMO) led the NDX 100 as it announced the accretive acquisition of Sirius Computer Solutions from Clayton, Dubilier, & Rice for $2.5 billion in cash. Baidu (BIDU) 171.04 +4.53% moved higher as China regulators appeared to consider changes that would make articles on Tencent Holdings (TCEHY) 64.07 +1.55% WeChat available on search engines. On the downside, Biogen Inc (BIIB) 269.40 -4.08% continued its downtrend since it peaked on 6/7 at 468.55 when US regulators approved its drug Aduhelm (Aducanumab) for Alzheimer’s. FuelCell Technology (FCEL) 8.74 +18.27% hit a 2 month high as the clean energy category responded to an upgrade of Plug Power (PLUG) by Morgan Stanley the prior week from equal weight to overweight.
Tuesday, Oct. 19, 2021 – DIA 354.43 +.55, QQQ 375.47 +.76%, SPY 450.59 +.76%, IWM 225.83 +.36%
In a sign of potential economic weakness Building Permits (MoM) for Sep. came in lower than expected 158.9K vs. 168K. Housing Starts as well posted lower at 155.5K vs. 162K expected. Interest rates moved higher with the 10-Year Index (TNX) 16.35 +.51 rising. Healthcare services (XLV) 128.77 was the top sector on the day followed by a rebound in Utilities (XLU) 65.87 +1.26%. Pharmaceutical companies Merck (MRK) 79.49 +3.03% and Johnson & Johnson (JNJ) 163.64 +2.34% led the DJIA. China-related technology shares continued their recent outperformance Baidu (BIDU) 179.00 +4.65%, JD.com (JD) 84.91 +3.02 NetEase (NTES) 100.39 +2.54%. Penn National Gaming (PENN) 81.34 +5.23% led the S&P 500. The stock hit a high of $142 back on March 15 subsequently selling off and has been basing around its 150-day moving average recently. Earnings are reported to come on Nov. 4 BMO. The big disaster on the day came from Atea Pharmaceuticals (AVIR) 13.82 -65.96% which disappointed on the release of trial data for the company’s pill for SARS-CoV-2 (COVID-19). ). Thermal Coal producer Peabody Energy (BTU) 15.90 – 19.13% came under selling pressure as China’s restrictions on coal mining appeared to be lifting as production increased to a 2021 high. Peabody’s shares had been as low as 80 cents a share last November.
Wed., Oct. 20, 2021 – DIA 356.03 +.44%, QQQ 374.98 -.13%, SPY 452.41 +.39%, IWM 227.37 +.66%
The Federal Reserve Beige Book showed wage pressures and modest to moderate economic growth. Interest rates were stable as the 10-Year note Index (TNX) 16.36 +.01 at the close was flat on the day but had shown pressure upwards in yield with a high of 16.53 earlier in the session. Utilities (XLU) 66.91 +1.58% was the top S&P 500 sector performer. While Technology (XLK) 158.35 -.28% was the clear laggard having been tempered by higher yields. United Healthcare (UNH) 435.09 +2.52 led the DJIA, as health plan firm Anthem (ANTM) 424.05 +7.7% broke to new highs after beating revenue & earnings expectations while raising 2022 guidance. WTI crude continued higher closing at 83.57. Leading the NDX 100 lower, payments processor PayPal (PYPL) 258.36 -4.91% as the company was reported to be preparing a $45 billion offer to acquire Pinterest (PINS) 62.68 +12.77%. On the COVID-19 vaccine front, Novavax (NVAX) 136.86 -14.76% fell on reports of manufacturing problems. In another disappointment, Healthcare Services Group (HCSG) 20.02 -13.97% failed to meet expectations on the bottom line. In August the company paid a $6 million dollar fine to the SEC for inflating quarterly earnings in order to meet analyst expectations.
Thursday, Oct. 21, 2021 – DIA 355.96 -.02%, QQQ 377.27 +.61%, SPY 453.69 +.28%, IWM 227.96 +.26%
Initial Jobless claims came in at 290K vs. the 300K estimate. The Philadelphia Fed Manufacturing Survey came in weaker than the estimated at 23.8 vs. the 25. Markets were consolidating with an upside bias. The S&P 500 hit a new all-time closing high. Interest rates moved higher with the 10-Year Note Index (TNX) 16.76 +.40 approaching a key resistance of 17. Consumer Discretionary (XLY) 193.49 +1.49% was the lead sector on the day, while Energy (XLE) 57.41 -1.85% came under profit-taking. Nike (NKE) 162.18 +2.35% led the DJIA. Swimming Pool supplies company POOLCORP (POOL) 499.33 +7.65% broke to new highs on a beat on earnings and revenues. Leading the S&P 500, Match Group (MTCH) 175.53 +10.29% spiked higher on news Google Play would cut fees in half for apps. Match Group releases earnings on November 2. Lockdown favorite Peloton Interactive (PTON) 94.98 +4.61% was the second-best performer in the S&P 500. The stock which has been a laggard since peaking on January 14th at $171.09 has recently seen relative strength after making a test of the lows of the January to May correction. On the downside, global technology firm International Business Machines (IBM) 128.33 -9.56% disappointed on earnings and revenue.
Friday, Oct. 22, 2021 – DIA 356.74 +.22%, QQQ 374.10 -.84%, SPY 453.12 -.10%, IWM 227.41 -.24%
Markit Manufacturing PMI preliminary came in weaker than expected 59.2 vs.60.3, while the Markit Services PMI preliminary posted stronger at 58.2 vs. the 55.1 expected. Both the DJIA and S&P 500 both hit new all-time highs, but the S&P closed lower. The NASDAQ Composite and NDX 100 ended the week within striking distance from all-time highs. Interest rates stabilized with the 10-Year Index 16.55 -.21 at 5-month highs. Financials (XLF) led the 12 S&P 500 sectors, followed by Energy (XLE) 57.95 +.94% which regained some of Thursday’s selling. American Express (AXP) 187.08 +5.42% led the DJIA after beating earnings handily, followed by Goldman Sachs (GS) 414.32 +1.65%. Internet retailer eBay (EBAY) 80.59 +5.75% broke out to new all-time highs ahead of 10/27 earnings. The big disappointment in the DJIA was semiconductor manufacturer Intel (INTC) 49.46 -11.68%. The company has had a string of disappointments on earnings as far back as July of 2020. A nice upside surprise came from steel producer Cleveland Cliffs (CLF) 23.85 +12.71% which beat earnings while nearly quadrupling steel-making revenues. The firm predicted higher steel prices going forward.
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