Monday 03/28/22 – DIA 349.49 +.27%, QQQ 364.91 +1.55%, SPY 455.91 +.71%, IWM 206.19 +.03% CNN Fear & Greed Index @ 49 (Neutral)
No high impact data released on the day. Equity markets traded on geopolitical headlines. WTI crude oil 103.46 -10.44 traded down on reports of COVID-19 lockdowns in Shanghai China. Ukraine was reported to have offered neutrality to Russia and that it would not continue efforts to join NATO in the future. Stocks traded mixed throughout the session closing mostly higher. Consumer Discretionary (XLY) 188.25 +2.67% took the top spot in the 11 S&P 500 economic sectors, with electric vehicle manufacturer Tesla (TSLA) 1091.84 +8.03% leading the way. Carnival Cruise Lines 19.40 +5.49% outperformed as well. COVID-19 vaccine manufacturer Moderna (MRNA) 173.08 +4.32% moved higher on the Shanghai reports. Microsoft (MSFT) 310.70 +2.31% led the DJIA, followed by Salesforce.com (CRM) 215.28 +2.01%. Energy Services (XLE) 76.80 -2.48% fell in sympathy with WTI crude oil. As a result, Energy stocks weighed on the S&P 500, Chevron (CVX) 166.35 -1.75% took last place in the DJIA with Schlumberger (SLB) 41.73 -4.46%, Baker Hughes (BKR) 37.00 -4.44%, Halliburton (HAL) 37.32 -4.06%, APA Corporation (APA) 39.85 -4.05%, and Diamondback (FANG) 140.70 -3.97% all underperforming. In a sign of increased confidence and outright speculation returning to the markets, meme stock GameStop (GME) 189.59 +24.77% rocketed higher on reports that board member Ryan Cohen had recent purchases of the company’s shares.
Tuesday 03/29/22 – DIA 352.97 +3.48%, QQQ 371.19 +1.72%, SPY 461.55 +1.24%, IWM 211.71 +2.68% CNN Fear & Greed Index @ 55 (Neutral)
The Housing Price Index came in ahead of expectations at +1.6% vs. 1.4%. The S&P Case Shiller Home Price index also came in higher than expected at +19.1% vs. +18.4%. Markets moved higher throughout the session closing near the highs. Real Estate (XLRE) 49.13 +2.93% was the top performer in the S&P 500 11 economic sectors, followed by Technology Services (XLK) 163.50 +2.12%. Credit card payment system provider Visa (V) 227.10 +3.33% took the top spot in the DJIA followed by lifestyle sports brand Nike (NKE) 139.14 +3.21%. Upscale electric vehicle manufacturer Lucid Group (LCID) 27.36 +7.8% took the top spot in the NDX100 followed by two pandemic favorites, video conferencing service Zoom (ZM) 126.26 +7.50%, and digital document and contract signing service DocuSign (DOCU) 111.24 +6.28%. On the downside fertilizer producers came under profit taking Mosaic (MOS) 64.45 -5.18% took last place in the S&P 500 followed by CF industries (CF) 99.78 -5.08%. Farm products company Archer Daniels Midland (ADM) 87.84 -4.88% fell and farming equipment manufacturer John Deere & Co. (DE) 412.92 -4.55% fell as well. In M&A news, television ratings provider Nielsen (NLSN) 26.76 +20.31% accepted a 16 billion dollar buyout offer from a private equity group led by Elliot Investment Management.
Wednesday 03/30/22 – DIA 352.12 -.24%, QQQ 367.09 -1.10%, SPY 458.70 -.62%, IWM 207.46 -2.01% CNN Fear & Greed @ 53 (Neutral)
ADP Employment Change for March reported at 455K vs. 450K expected. Gross Domestic Product for 4Q21 came at 6.9% vs. 7% expected. The GDP Price Index was slightly less than expected at +7.1% vs. +7.2%. Equity markets were mixed through the day but sold off late in the session. Energy Services (XLE) 77.49 +1.16% outperformed on the day as WTI crude oil 107.44 +3.20 rebounded. Healthcare Services (XLV) 138.34 +.20% took the second spot in performance. United Healthcare (UNH) 520.82 + 1.98% led the DJIA. Building materials retailer and home improvement company Home Depot (HD) 308.46 -2.91% took last place in that index. Yoga wear athletic brand retailer Lululemon Athletica (LULU) 376.92 +9.58% posted better than expected earnings and gave a strong forecast for 2022. On the downside semi-equipment and semiconductor companies came under profit taking: QUALCOMM (QCOM) 152.73 -5.18%, Microchip (MCHP) 76.39 -4.25%, Marvel (MRVL) 73.01 -4.14% and Applied Materials (AMAT) 135.80 -3.99%. Also on the downside, home improvement firm Restoration Hardware (RH) 334.28 -13.33% fell on earnings sighting soft demand.
Thursday 03/31/22 –DIA 346.83 -1.50%, QQQ 362.54 -1.24%, SPY 451.64 -1.54%, IWM 205.27 -1.06% CNN Fear & Greed Index @ 51 (Neutral)
Initial Jobless Claims reported at 202K a bit higher than the 197K expected. Personal Income for February came in as expected at +.5%, while Personal Spending was weaker than expected coming in at +.2% vs. +.5%. The Chicago Purchasing Managers Index was stronger than expected 62.9 vs. 57. President Biden announced the drawdown form the strategic petroleum reserve of 1mm barrels per day for the next 6 months to meet increased post pandemic demand for crude oil. Equity markets traded mostly flat throughout the session but succumbed to late day sell programs that appeared to be related to end of quarter rebalancing. Interest rates rose as the yield curve showed a continued trend toward a potential inversion. Financial Services (XLF) 38.32 -2.29% was hardest hit. Walgreen’s Boots Alliance (WBA) 44.77 -5.67% led the DJIA to the downside. The firm beat on earnings and revenue but failed to inspire as the firm expects a slowdown in COVID-19 vaccinations going forward. Semiconductor and Semi-equipment stocks were for sale Intel (INTC) 49.56 -3.64% was the second worst performer in the DJIA. While Advanced Micro Devices (AMD) 109.34 -8.29% was the worst performer in the S&P 500 as Barclay’s downgraded the stock from ‘overweight’ to ‘equal weight’. China internet shares once again underperformed. Pinduoduo (PDD) 40.11 -8.34%, Baidu (BIDU) 132.30 -8.02%, JD.com (JD) 57.87 -5.89% were all down as an uncertain regulatory environment continues to drive trading.
Friday 04/01/22 – DIA 348.01 +.34%, QQQ 361.85 -.19%, SPY 452.92 +.28%, IWM 207.57 +1.12% CNN Fear & Greed Index @51 (Neutral)
Non-Farm Payrolls came in robust at +431K but under the +490K expected. The ISM Manufacturing PMI was lower than expected at 57.1 vs. 59. The Unemployment Rate was reported at 3.6% vs. 3.7% expected, while the Labor Force Participation Rate improved to 62.4% from the expected 62.2% demonstrating that those individuals on the sidelines were returning to the labor pool. The U6 Underemployment Rate dropped to 6.9% from 7.2% showing that more people were finding fulltime work. In response to the payroll report the US treasury yield curve inverted between the 2 year (2.48%) and 10 year (2.36%) notes. An inverted yield curve has been associated with economic recessions in the past. Equity markets traded mostly in negative territory for the majority of the session but rallied late to close positive on the day. Real Estate (XLRE) 49.28 +1.99% led the 11 S&P economic sectors. In response to the inversion of the yield curve Industrials (XLI) 102.18 -.78% were the clear laggard. Over concerns of falling demand and the inverted yield curve, freight transportation stocks led to the downside; trucking firm JB Hunt Transport Services (JBHT) 181.51 -9.6% fell hard along with railroads Norfolk Southern (NSC) 265.84 -6.79%, CSX Corporation (CSX) 35.51 -5.18%, and Union Pacific (UNP) 259.96 -4.85%. In earnings news, digital cloud banking software provider nCino (NCNO) 46.58 +13.67% met earnings expectations but beat on revenues.
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