Market Alert - The Close

Bitcoin futures started to trade on the CME, a pipe bomber/attempted murderer botched his bombing attempt in NYC, and stocks ignored it all. Futures were up modestly, not surging, not tanking, and when the open came stocks moved up.

Not all stocks. The midcaps and small caps started higher but peaked out in the first hour, sliding all session into the close, putting in modest losses. Not bad action, just modest tests of the Thursday/Friday bounce to end last week.

SP500 8.49, 0.32%
NASDAQ 35.00, 0.51%
DJ30 56.87, 0.23%
SP400 -0.14%
RUTX -0.12%
SOX 0.59%

SOX was positive on the session, but it did nothing to improve its pattern. A lot of the prior leaders in the group traded flattish in rather uninspired trade. Chips certainly are uninspired at this juncture.

NASDAQ continued its now 4-day recovery move, gapping higher, closing higher. Big names of course helped given RUTX was lower on the day. AAPL was the star in our book, rising 1.95% and more importantly, breaking higher in its downward wedge on some very good volume. MSFT completed its recovery from the prior Monday selloff, notching a higher closing high on this move. CSCO is not bad and GOOG was up as well. FAANG overall was blah, but blah is good: FB, AMZN and even GOOG could use a bit of rest and they mostly took it. Not selling off and taking a breather is not bad action.

SP500 and DJ30 put in new closing highs if not new all-time highs, continuing the upside after their rather textbook test of the 10 day EMA last week following new highs once again. For the Dow, the tech contingent of AAPL, MSFT and CSCO did a lot of the lifting, but DIS, PFE, MRK, VZ and NKE were up nicely as well.

Leadership saw a bias toward tech, particularly large cap tech. AAPL, MSFT, CSCO, GOOG.

FAANG was led by AAPL while AMZN and GOOG added modest gains. FB traded flat after trading just a bit lower, a good session of consolidation that could set up its next leg higher in this recovery. Not bad overall.

Oil stocks rallied nicely. PTEN moved higher as did many. CVX gapped higher but just stalled with a doji. Still very good patterns, but that has been the case all along. They are starting to break higher here and there, and we continue to look at them as well.

Industrial, machinery were somewhat off on the day as HON, MMM took a breather. CAT, DE, CMI, TEX flat to slightly higher.

Financial stocks were just flat on the session after a decent last half of the prior week.

Drugs/Healthcare showed nice moves as noted on the DJ30 discussion. Big cap biotechs are not bad, and many smaller issues are set up well.

Basically, leadership continues to slosh in the same groups with the large cap techs trying to continue their comeback and rally with the financials, machinery, transports, etc. Thus far they are hanging in.

We anticipate playing more upside as these stocks test their recent moves and start back upside. We saw AAPL doing this and moved in, NTES as well. We keep looking for opportunities in good setups just as we have done on others such as ROKU.

Have a great evening!
Jon Johnson, Chief Market Strategist
InvestmentHouse.com
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