The S&P 500 is up for three days in a row, rising 0.1% yesterday.  While the market had an “up” day yesterday, the internals of the market deteriorated.  Yesterday, the Financials broke TREND and is now broken on both durations.  Over the past month the XLF has declined 2%, while the S&P 500 is up 2.2%.


The S&P 500 rallied for much of the day on a renewed focus on the global recovery theme, as the World Bank boosted its 2010 China GDP forecast.  Also, the market seem to benefit from the Fed's decision to not make any meaningful changes to interest rates or and changes to its policy statement. Although, trading following the FOMC decision was fairly choppy and the indexes saw a meaningful pullback in the last half-hour or so of trading. 


On the day the VIX declined 3.8%, also declining for the second day in a row.  The UUP, the etf used to track the dollar index, was down 0.7% on the day.


The three best performing sectors were Healthcare (XLV), Utilities (XLU) and Technology (XLK), while Energy (XLE), Industrials (XLI) and Financials (XLF) were the bottom three.  All of the bottom three sectors were down on the day. 


The Healthcare (XLV) moved higher for the second straight session with the HMO’s leading the way.  Yesterday’s performance was largely driven by thoughts that Republican wins in the NJ and VA governor races could dampen the appetite for aggressive healthcare reform. There is even some speculation that reform legislation may be pushed back to next year. 


The Financials (XLF) was one of the worst performing sectors yesterday, closing down 1.4%. The regional banks remained under pressure on capital and CRE concerns.


The Consumer Discretionary, especially retail stocks lagged the broader market again yesterday with the etf closing flat on the day.  The underperformance came despite an upbeat tone to today’s release of October same-store sales.


Today, the set up for the S&P 500 is: TRADE (1,064) and TREND is positive (1,027).   The Research Edge quantitative models have 6 of 9 sectors in the S&P 500 positive on TREND and 1 of 9 sectors are positive from the TRADE duration.  Consumer Staples is the only sector positive on both durations and the Financials broke TREND. 


The Research Edge Quant models have 2% upside and 2% downside in the S&P 500.  At the time of writing the major market futures are poised to open up to the upside. 


The Research Edge MACRO Team.






Cartoon of the Day: 'Biggest Tax Cut Ever'

President Donald Trump's economic team unveiled what he called last week, "the biggest tax cut we’ve ever had.” Before you get too excited about that hang on a sec. "Trump Tax Reform ain’t gettin’ done anytime soon," Hedgeye CEO Keith McCullough wrote in today's Early Look.

read more

Neurofinance: The Psychology Behind When To Sell A Bull Market

"Most momentum investors stay invested too long, under-reacting and holding tight after truly bad news finally arrives to break the trend," writes MarketPsych's Richard Peterson.

read more

Energy Stocks: Time to Buy the Dip? | $XLE

What the heck is happening in the Energy sector (XLE)? Energy stocks have trailed the S&P 500 by a whopping 15% in 2017. Before you buy the dip, here's what you need to know.

read more

Cartoon of the Day: Hard-Headed Bears

How's this for "hard data"? So far, 107 of 497 S&P 500 companies have reported aggregate sales and earnings growth of 4.4% and 13.2% respectively.

read more

Premium insight

McCullough [Uncensored]: When People Say ‘Everyone is Bullish, That’s Bulls@#t’

“You wonder why the performance of the hedge fund indices is so horrendous,” says Hedgeye CEO Keith McCullough, “they’re all doing the same thing, after the market moves. You shouldn’t be paid for that.”

read more

SECTOR SPOTLIGHT Replay | Healthcare Analyst Tom Tobin Today at 2:30PM ET

Tune in to this edition of Sector Spotlight with Healthcare analyst Tom Tobin and Healthcare Policy analyst Emily Evans.

read more

Ouchy!! Wall Street Consensus Hit By Epic Short Squeeze

In the latest example of what not to do with your portfolio, we have Wall Street consensus positioning...

read more

Cartoon of the Day: Bulls Leading the People

Investors rejoiced as centrist Emmanuel Macron edged out far-right Marine Le Pen in France's election day voting. European equities were up as much as 4.7% on the news.

read more

McCullough: ‘This Crazy Stat Drives Stock Market Bears Nuts’

If you’re short the stock market today, and your boss asks why is the Nasdaq at an all-time high, here’s the only honest answer: So far, Nasdaq company earnings are up 46% year-over-year.

read more

Who's Right? The Stock Market or the Bond Market?

"As I see it, bonds look like they have further to fall, while stocks look tenuous at these levels," writes Peter Atwater, founder of Financial Insyghts.

read more

Poll of the Day: If You Could Have Lunch with One Fed Chair...

What do you think? Cast your vote. Let us know.

read more

Are Millennials Actually Lazy, Narcissists? An Interview with Neil Howe (Part 2)

An interview with Neil Howe on why Boomers and Xers get it all wrong.

read more