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Today’s Summary
Thursday, December 16th, 2021
Indices: Dow -0.08% | S&P 500 -0.87% | Nasdaq -2.47% | Russell 2000 -1.95%
Sectors: 8 of the 11 sectors closed higher. Financials led, gaining 1.26%. Tech lagged, dropping 2.83%.
Commodities: Crude Oil futures rose 1.24% to $71.75 per barrel. Gold futures gained 2.03% to $1,800 per ounce.
Currencies: The US Dollar Index fell 0.35%.
Interest Rates: The US 10-year Treasury yield dropped to 1.41%.
Here are the best charts, articles, and ideas being shared on the web today!
Chart of the Day
Four S&P sectors with new all-time highs today:
Real Estate $XLRE
Staples $XLP
Health Care $XLV
Utilities $XLU pic.twitter.com/5heeE4QBPf— Grayson Roze (@GraysonRoze) December 15, 2021
Today’s Chart of the Day was shared by Grayson Roze (@GraysonRoze). The chart shows the four defensive sectors of the S&P 500 over the past year – Real Estate, Consumer Staples, Health Care, and Utilities. These four have been the strongest sectors over the past month. As Grayson points out, all four are at all-time highs. To be fair, this chart was shared yesterday but all four continued higher today and printed fresh record highs. There’s a clear shift from offense to defense that has been going on the past few weeks. Defensive sectors and boring Low-Volatility stocks have become the new momentum plays. This isn’t exactly the healthiest leadership, as it represents a general lack of risk appetite among market participants. Regardless of what this says about the broader market, these sectors are clearly working right now and look poised to continue higher in the near term.
Quote of the Day
“There’s always free cheese in a mousetrap.”
– Anonymous
Top Links
Outperformance from Low Volatility – Bespoke
Bespoke examines the recent strength in Low Volatility stocks.
The S&P 500 Doesn’t Care That Breadth is Still Weak – Potomac Fund Management
Dan Russo shares his weekly breadth analysis.
Looking at Markets After FOMC – TD Ameritrade Network
In this clip, Andrew Thrasher offers his thoughts on stocks after yesterday’s Fed meeting.
Bitcoin is NOT an Inflation Hedge…Yet – All Star Charts
Louis Sykes explains that Bitcoin is not an effective hedge against inflation despite the narrative that it is.
The Market’s Okay – The Irrelevant Investor
Michael Batnick offers his perspective on market breadth.
Top Tweets
The Dow, Nasdaq and S&P 500 are on different planets today.
— Eddy Elfenbein (@EddyElfenbein) December 16, 2021
#NQ_F, 1h
10 rejections in the last 30 days…
Epic. pic.twitter.com/GibFBL5c4D
— Yuriy Matso (@yuriymatso) December 16, 2021
$IWC no follow-through today… pic.twitter.com/VHwLzKN0qI
— Mike Zaccardi, CFA, CMT (@MikeZaccardi) December 16, 2021
Meanwhile, microcaps…
Does this count as a breakdown yet? pic.twitter.com/S7Pbb5aAPP
— Mike Singleton, CFA (@InvictusMacro) December 16, 2021
The Healthcare sector has found its way to new ATHs, led by stocks like $ABBV $PFE $LLY and $GILD$XLV pic.twitter.com/s7m6eGBRgx
— Ian McMillan, CMT (@the_chart_life) December 16, 2021
Consumer Staples sector having its best month relative to S&P 500 since March 2020
[Past performance is no guarantee of future results] pic.twitter.com/BYsxiMHGae— Liz Ann Sonders (@LizAnnSonders) December 16, 2021
Chart Update
It appears defensive assets might get a bit of time in the sunshine if this ratio resolves lower.
Better be very careful with the dips you're buying out there and those "perceived discounts"$SPY $QQQ $IWM $XLP $XLY pic.twitter.com/GA38CvbBbU— Sam McCallum ??????? (@honeystocks1) December 16, 2021
Defense stocks continue to lead us to bull's paradise. pic.twitter.com/euiF07iYXt
— Cowboy (@Xiphos_Trading) December 16, 2021
The S&P index hasn't had a major correction this year (max drawdown 5.2%), but the vast majority of its components have:
Nearly 40% have fallen 20% or more.
More than 90% have been down at 10% from their highs.
100% have had larger drawdowns than the index itself. pic.twitter.com/p7drEdQ2Ol— Willie Delwiche, CMT, CFA (@WillieDelwiche) December 16, 2021
That $SPX has exceeded its 40wma for 70-plus weeks suggests mean reversion, but doesn’t guarantee an imminent top. $STUDY pic.twitter.com/yldK6cFSip
— Mark Ungewitter (@mark_ungewitter) December 16, 2021
Old tech is really rocking these days… here's $CSCO breaking to its highest level in over 20yrs pic.twitter.com/seShCo4qKT
— Steven Strazza (@sstrazza) December 16, 2021
Buzzwords which cause people to hold losing stocks longer than they should
– 3D Printing
– Space travel
– Metaverse
-Blockchain
– EV
-BNPL
– ESG
what else?— Brian Shannon, CMT (@alphatrends) December 16, 2021
You’re all caught up now. Thanks for reading!