Yesterday was a pedestrian session that simply got stronger during the day. The pressure slowly mounted for reluctant money managers and individual fence-sitters to get in the mix. Perhaps the best example was a midday report that Dan Loeb stopped hating and learned how to love a few hot stocks.
Loeb, the manager of Third Point Hedge fund, has either added or started new positions, including:
- Amazon (AMZN)
- Alibaba (BABA)
- JD.com (JD)
- Disney (DIS)
I suspect that more m
asters of the universe, including those stoking great fear and panic back in March and April, will slowly come around. It’s their job, after all - to make people money rather than posturing as philosophers that know everything under the sun, except how to beat the market.
Another driver that shouldn’t be stealthy, and yet isn’t being reported, is the string of strong economic releases.
S&P 500 Index | +0.64% | |
Communication Services XLC | +2.63% | |
Consumer Discretionary XLY | +0.49% | |
Consumer Staples XLP | -0.02% | |
Energy XLE | -0.80% | |
Financials XLF | -0.04% | |
Health Care XLV | -0.53% | |
Industrials XLI | +0.38% | |
Materials XLB | -0.42% | |
Real Estate XLRE | +0.19% | |
Technology XLK | +1.41% | |
Utilities XLU | +0.58% |
Portfolio Approach
Today’s Session
The morning began under slight pressure in response to President Trump issuing an executive order restricting TikTok from operating in the United States. He also is blocking WeChat; although he is not prohibiting the company’s American game subsidiaries from doing business. There is a lot of speculation about retaliation, and most commentators speak of the United State as if it has the weaker hand.
There will be saber rattling, but that is about it.
Jobs Report
The initial jobs report for July has come in stronger than expected.
- 1,763,000 versus consensus of 1.6 million
- 10.2% unemployment rate consensus 10.6%
To see the chart, click here.
More details to come in the afternoon note.
Equity futures rallied on the news but are easing a little since. The market just seems tired after the S&P 500 has rallied five straight days with lackluster market breadth.
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