Last week was an incredible week for the market, which fought a tug of war between future vaccines and reopening the economy against the current Covid-19 spikes and increased lockdowns. By the closing bell on Friday, the verdict was in; Wall Street is skipping the dark winter predicted and orchestrated by politicians and looking to a bright spring and summer driven by scientists.
Market breadth was extremely bullish, especially on the New York Stock Exchange, as Technology names stumbled about with other lockdown winners. The rally is broadening, and that’s great news.
Market Breadth | NYSE | NASDASQ |
Advancers | 2,559 | 2,670 |
Decliners | 619 | 66 |
New Highs | 431 | 552 |
New Lows | 40 | 67 |
Up Volume | 17.6 billion | 12.3 billion |
Down Volume | 11.1 billion | 9.3 billion |
S&P 500
Winners
- 278 average gain +25.13%
- Top twenty average gain +89.29%
Losers
- 227 average los: -20.81%
- Bottom twenty average decline -57.40%
Nasdaq
Winners
- 578 average gain +68.41%
- Top twenty average gain +533.88%
Losers
- 436 average loss -22.74%
- Bottom twenty average decline: -66.03%
Sector Watch
The interesting aspect of rotation is how the move brings the same kind of parabolic action to normally low Beta sectors and stocks.
S&P 500 Index | +2.16% | |
Communication Services XLC | +0.64% | |
Consumer Discretionary XLY | +0.45% | |
Consumer Staples XLP | +3.75% | |
Energy XLE | +17.11% | |
Financials XLF | +8.29% | |
Health Care XLV | +2.00% | |
Industrials XLI | +5.43% | |
Materials XLB | +1.49% | |
Real Estate XLRE | +5.28% | |
Technology XLK | -0.31% | |
Utilities XLU | +3.06% |
Keep an eye on energy to continue to outperform after the index soared above its 50-day moving average. WTI needs to breakout soon, but the stocks could lead the commodity near term.
Hotline Model Portfolio Approach
We took profits in a Technology stocks and are adding to Healthcare in our Hotline Model Portfolio.
Today’s Session
Moderna (MRNA) comes through with a vaccine that one-ups Pfizer’s (PFE) vaccine candidate announced last Monday. The news was expected, although not sure anyone was looking for 94.5% effectiveness. Look for more short covering and rotation into reopening stocks and a return sooner rather than later to normalcy. This is powering Boeing (BA) among other names. Keep an eye on Russell 2000, which is at a double top but has huge momentum.