Stock Market Today: March 1st - 5th, 2021

Morning Lineup - 3/3/21 - Put Up or Shut Up
Wed, Mar 3, 2021

Markets are looking to make an attempt to rebound from yesterday's weakness, but the effort hasn't been all that inspiring to this point as futures have erased more than half of their gains. If the inability of futures to hold on to their gains isn't enough, today also marks the birthday of Charles Ponzi!

ADP Private Payrolls were just reported and missed expectations by nearly half (117K vs 225K). The big report of focus for the remainder of the day will be the ISM Services report at 10 AM.

US equities opened higher yesterday but sold off from the opening bell right until the close in what can only be described as a disappointing session for bulls. Below we show intraday charts of the S&P 500 and Nasdaq over the last 15 trading days, and what you can also see in both charts is that their opening prints also coincided with downtrend lines that have been established from the index highs in mid-February. At this point, the burden of proof is on the bulls to break these downtrends. Based on where futures are trading now, neither of these trends will come into play at the opening bell, but if the markets can build on their early gains, a test could come into play. Stay tuned!

 

i am so clueless on the direction of the market for the short and even medium term atm. no idea where this thing goes from here. could be extremely choppy until we get another market moving catalyst in either direction, which honestly i'm not even sure what that could be haha. i mean absent something totally and completely out of left field that surprises everyone and their cousins (cue the black swan event), it would seem to me like this market could be in for a lot of choppy range bound action for a bit. which could make for some really boring market days haha.

 

Good Thursday morning StonkForumers!

Here is this morning's pre-market news thread for those of you wanting to get a quick read before today's open-
<-- click there to read!

Hope everyone has a great trading day ahead today.

 

Morning Lineup - 3/4/21 - One Step Forward, Two Steps Back
Thu, Mar 4, 2021

After a strong start to March, major US equity indices have given up all or most of those gains in the last two days. Based on where futures are trading now, today may mark a third step backward for the equity market, although not to the same degree as the last two days. Treasury yields, which have been the tail wagging the market lately, are lower this morning with the 10-year US Treasury yield trading right around 1.45%. The economic calendar is jammed packed with Non-Farm Productivity (weaker than expected), Unit Labor Costs (weaker than expected), and Jobless Claims (in line with forecasts) just crossing. Then at 10 AM, we'll get Durable Goods and Factory Orders at 10 AM. Fed Chair Powell will also be speaking just after noon.

The Technology sector closed below its 50-day moving average again yesterday, and while many tech stocks have been getting slammed of late, the sector is down less than 7% from its closing high in February. The chart of the sector lately looks a bit ominous though. If you squint enough, you can see what looks like a head and shoulders pattern forming over the last several weeks with the neckline also coinciding with the highs from early September. If that breaks, this March, which came in like a bull (briefly), would likely be filled with more bear.



The Energy sector has been a completely different story. The sector remains right near 52-week highs after recently breaking above resistance from its June post-COVID high.

Given the diverging paths of the two sectors, the performance spread between the two sectors over the last six months now stands at 35.3 percentage points, which is the widest margin of underperformance for the Technology sector relative to Energy in nearly 20 years!

 

think you pretty much hit the nail on the head there with your comment yesterday regarding those bond yields. looks like another new high there today

meanwhile,has anyone took a gander at the black gold lately? another new 52wk high there, and don't look now, but we're now knocking on the door on the post-iran spike highs from jan. of last year

this has admittedly been by far my biggest surprise of all in 2021 up to this point thus far...even more than the spike we've been seeing in those bond yields.

 

wow hadn't check on the market until just now, and saw it took another quick leg down in literally the past 5 minutes. spx lost about what, 20 handles in about a few minutes there?

 

haha, it's so weird how that sounds. but you're 100% spot on! markets need bad news to reverse the decline. shouldn't it be the other way around? lmao. and yea, wow nazzy first of the majors to have entered correction territory

 

interesting bit of stat i just ran across on my twitter feed just now. currently, the nazzy is down -9.9% from its ATH. if it closes down 0.10% or greater tomorrow, that would be one of fastest corrections ever for the nazzy. evidently 2020 had the two fastest corrections ever.

 

Morning Lineup - 3/5/21 - Stronger Than Expected Jobs Report
Fri, Mar 5, 2021

Thankfully, it's Friday. After another week of declines for equities, futures were modestly positive this morning, but that changed with the release of the February employment report. The bond market was already showing some signs of concern heading into the release, and those concerns look to have been warranted as the headline number came in well above forecasts (379K vs 200K). In reaction to the report, the 10-year yield has risen from a pre-release level of 1.58% to 1.62% now.

Normally, when the equity market comes under selling pressure bonds rally providing some level of cushion to a diversified portfolio. In the last few weeks, though, that still hasn't been the case. The chart below is from the second page of the Morning Lineup and shows the relative strength of the S&P 500 versus the US Treasury Long Bond Future. In an environment like the last couple of weeks where stocks have been weak, you would expect the relative strength line of the S&P 500 to decline, but so far during this pullback that hasn't been the case. Despite a 4.6% pullback in the S&P 500, its relative strength versus the Long bond Future remains near 52-week highs.