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Today’s Summary
Friday, October 1st, 2021
Indices: US Stocks closed higher in today’s session with the Dow rebounding 483 points or 1.43%. The S&P 500 and Nasdaq rose 1.15% and 0.82%, respectively. The Russell 2000 outperformed, gaining 1.69%.
Sectors: None of the 11 sectors closed lower. Energy led by a wide margin, jumping 3.36%. Utilities lagged, closing unchanged.
Commodities: Crude Oil futures rose 0.95% to $75.74 per barrel – the highest level in nearly three years. Gold moved higher by 0.24% to $1,761 per ounce.
Currencies: The US Dollar Index slipped 0.18%.
Interest Rates: The 10-year US Treasury yield fell for the third straight day to 1.465%
Here are the best charts, articles, and ideas being shared on the web today!
Chart of the Day
Commodities have outperformed Stocks over the last 18 months. The last time we saw that happen was back in 2010-2011… pic.twitter.com/XYBHOzeaQo
— Charlie Bilello (@charliebilello) October 1, 2021
Today’s Chart of the Day was shared by Charlie Bilello (@charliebilello). It’s a ratio chart of Commodities vs. Stocks over the past 20-years (CRB Index vs. S&P 500). As a reminder, when the ratio is rising, it means Commodities are outperforming Stocks and vice versa. Stocks are enjoying an above-average year, with very little downside volatility, however, the real alpha has been in Commodities. The CRB index, which consists of 19 major Commodities is up more than 37% YTD, while the S&P 500 is up 16%. Charlie points out that it has been a decade since we’ve seen Commodities outperform Stocks on a trailing 18-month basis. Ironically, this ratio bottomed out right after Crude Oil went negative in April 2020. This trend of outperformance could easily continue as investors’ performance chase this abandoned asset class.
Quote of the Day
“Speak less than you know;
have more than you show.”
– William Shakespeare
Top Links
Q3 Asset Class Performance – Bespoke
Bespoke breaks down Q3 asset class performance.
A Strong Uptrend and Bullish Continuation Pattern for this Agricultural ETF – StockCharts.com
Arthur Hill points out that the Agricultural Commodities ETF, $DBA, is attempting to break out of a bullish Cup & Handle pattern.
Will Markets Rebound in October? – CNBC
Jeff deGraaf of Rennaissance Macro Research shares his fourth-quarter outlook.
Stock Market Analysis – October 1, 2021 – Alphatrends
Brian Shannon reviews this week’s price action and lays out a few key levels to watch in the week ahead.
Is Bearish Investor Sentiment Bullish for Stocks? – LPL Financial Research
The team at LPL Financial Research analyzes the results of the most recent AAII Sentiment Survey.
Top Tweets
BOO!
Happy VOLtober.
We've just kicked off what is historically the S&P 500's most rocky month of the year. pic.twitter.com/u0BfqBtdFt
— Callie Cox (@callieabost) October 1, 2021
Since 1980, the average year sees a max peak-to-trough correction of 14.2% for the S&P 500.
Yes, this current 5.1% pullback doesn't feel great, but it is so important to remember that most years this is perfectly normal. pic.twitter.com/syfo5J72b5
— Ryan Detrick, CMT (@RyanDetrick) October 1, 2021
Here are all the longest steaks w/o a 5% correction in the past 50 years (per Ned Davis):
1. All went on to lose at least 8%
2. None devolved directly into more than a normal correction
3. The next cyclical high in $SPX was at least 2 mo and as long as 12 mo later pic.twitter.com/rH9Yd4oSRB— Urban Carmel (@ukarlewitz) October 1, 2021
The Russell 2000's consolidation on the weekly really narrowing up, suggesting we could get a resolution soon. $RUT pic.twitter.com/hAtq7j3wXt
— Michael Turvey (@MikeTurvey_TDA) October 1, 2021
$IWM vs $SPX
Russell 2000 vs S&P 500Small caps breaking a downwards rate of trend and getting above horizontal resistance on a relative basis. pic.twitter.com/RDUsoQslTR
— Pratyush Tulsian (@PrattyCharts) October 1, 2021
Ten US Sectors closed the month of September in the red. One did not… $XLE pic.twitter.com/n6Kf2WrQ3r
— Shane C. Murphy (@murphycharts) September 30, 2021
Since the 9/2/21 top, 18 of the 20 worst performing $RUA stocks are in the Healthcare sector. Healthcare selling perhaps a bit overdone? pic.twitter.com/bN7bD0GYNI
— Quantifiable Edges (@QuantifiablEdgs) October 1, 2021
YTD $ARKK ARK Innovation ETF is down 11.36%
The assets under management are down 30% from a peak of 28.2M to 19.73B, this indicates people are bailing on it as it underperforms
Meanwhile, shorts continue to press their bets 21.7M shrs = $2.4B short
1/3 pic.twitter.com/9l6pdRlxSt
— Brian Shannon, CMT (@alphatrends) October 1, 2021
Yesterday was the biggest outflow from the long-bond $TLT ETF since March 2020 pic.twitter.com/71B2GtQb8o
— Dani Burger (@daniburgz) October 1, 2021
Commercial hedgers are short $DXY futures, and in the bottom 10th percentile of historical readings (we normalize it thru time). Historically, it's a good contrarian signal and suggests continued $ strength. 66% winning trades w/ 1.68 win/loss advantage. pic.twitter.com/bWfIX2ngnC
— RenMac: Renaissance Macro Research (@RenMacLLC) October 1, 2021
Some of these Thermal Coal stocks are going bonkers. Just when you think coal is dead, the world runs out of stuff to burn. pic.twitter.com/KpVxugPkce
— Jack Damn (@JackDamn) October 1, 2021
Up 42.79% last month pic.twitter.com/zKZr2ZLa9X
— Ian Culley (@IanCulley) October 1, 2021
Coffee prices $KC_F beginning the sweet spot of a parabolic advance from a massive base pic.twitter.com/2NYyGJ4rsJ
— Peter Brandt (@PeterLBrandt) October 1, 2021
Insert some joke about ? pops cereal, idk… ? @KelloggsUS pic.twitter.com/3ricBLHU1E
— Dan J. Gorghuber, CMT (@Futures_Runner) October 1, 2021
#Bitcoin is up a whopping 16% in the last two days! pic.twitter.com/KSYI5x6YEB
— True Insights (@true_insights_) October 1, 2021
that's some way to break this range pic.twitter.com/CvopNfok7h
— Louis Sykes (@haumicharts) October 1, 2021
You’re all caught up now. Thanks for reading!