Trading Places with Tom Bowley

U.S. Equities Rally As Treasury Yields Soar

Market Recap for Wednesday, September 27, 2017

U.S. stocks were lifted at least in part by rising treasury yields.  The 10 year treasury yield ($TNX) spiked 8 basis points and that represents a significant selloff in treasuries.  Those proceeds tend to be reinvested in equities and that was certainly the case on Wednesday.  The Russell 2000 ($RUT) has been on fire and it rose nearly 2% in another emphatic relative strength statement.  The NASDAQ gained more than 1% and both the Dow Jones and S&P 500 rose as well.  Clearly, however, the day belonged to the more aggressive stocks found on the Russell 2000 and NASDAQ.

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Bearish Seasonal Summer Period Coming To An End

Market Recap for Tuesday, September 26, 2017

Late day selling created a bifurcated U.S. market on Tuesday as small caps performed quite well ($RUT, +0.34%), while the Dow Jones finished slightly in negative territory.  Technology (XLK, +0.36%) rebounded after Monday's selling to lead most of our indices higher.  Consumer stocks also performed well with consumer staples (XLP, +0.24%) posting a decent gain.  Consumer discretionary (XLY, +0.01%) was mostly flat, but outperformed the other six sectors.  Materials (XLB, -0.44%) was the weak link, but after very solid gains this month, it was entitled to a little profit taking.  Here's the current chart for the XLB:

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Technology Slumps As Facebook Falls On Heavy Volume

Market Recap for Monday, September 25, 2017

Technology (XLK, -1.18%) was the only real problem on Monday, but it was a big problem.  Mobile telecommunications ($DJUSWC) and internet stocks ($DJUSNS) were the big losers with the latter slammed by Facebook (FB), which dropped nearly 5% on extremely heavy volume.  There's an interesting weekly chart on FB below in the Sector/Industry Watch section.  Here's the current look at the XLK:

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Russell 2000 Tests Key Resistance, Primed To Lead In 4th Quarter

Market Recap for Friday, September 22, 2017

Friday was a bifurcated kind of day on Wall Street.  We saw a small loss on the Dow Jones, while there were slight gains on the other major indices.  The Russell 2000, in particular, saw relative strength and gained nearly 7 points to finish at 1450.  That's a big level of price resistance as you can see below:

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Taking A Look At Near-Term Downside Risk For The S&P 500

Market Recap for Thursday, September 21, 2017

We are in one of the most bearish historical periods of the year and I've provided a bit more information about it in the Historical Tendencies section below.  I'm pointing this out because equities took a break on Thursday and futures are down slightly this morning.  We could be in for more short-term weakness and I've identified key support levels to watch on the S&P 500 in the Current Outlook section below.

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Railroads, Transports Lead Dow Jones To 6th Consecutive All-Time High

Market Recap for Wednesday, September 20, 2017

It was another stellar day for industrials (XLI, +0.73%) as this sector led the Dow Jones to a 6th consecutive record closing high.  The gains have been fairly slow and methodical, but that's how bull market advances work.  They tend to occur very slowly in boring fashion as volatility ($VIX) drops day after day.  After the VIX closed at 12.23 on September 5th, it's dropped nearly every day and closed yesterday at 9.78.  It's rare to see the VIX below 10 historically so take note of this lack of expected volatility ahead.  It's flashing a very bullish signal.

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Banks Strengthen To Lead Financials, Major Indices Higher

Market Recap for Monday, September 18, 2017

It was another very bullish day on Wall Street as most indices finished with gains once again.  The Russell 2000 ($RUT) led the charge with a 0.65% rise.  Gains in the Dow Jones and S&P 500 were more modest, but still both managed to close at fresh all-time highs.  It's difficult to be disappointed with that type of action.

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S&P 500 Tops 2500 For First Time; Monday Trade Setups

Market Recap for Friday, September 15, 2017

It was another day of records on Wall Street to close out the week.  Despite the peak of seasonal summer weakness approaching, buyers stepped up to the plate once again, this time driving S&P 500 prices to another all-time high close and, in the process, clearing a psychological level at 2500.  Volume was extremely heavy, but don't read too much into that.  It was quadruple witching day, which occurs the 3rd Friday of March, June, September and December.  We always see heavy volume on these days as you can see below on the NASDAQ chart:

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Autos And Auto Parts Continue To Strengthen After Their Recent Breakout

Market Recap for Thursday, September 14, 2017

Consumer discretionary (XLY, -0.54%) was the worst performing sector on Thursday, but you'd never know it from looking at the automobiles or auto parts stocks.  The Dow Jones U.S. Automobiles & Parts Index ($DJUSAP) is featured below in the Sector/Industry Watch section, so I'll get to that in a bit.  Travel & tourism stocks ($DJUSTT) and broadcasting & entertainment stocks ($DJUSBC) both lost more than 1% yesterday as discretionary stocks lagged.  Walt Disney (DIS), a major component of the latter group, has struggled quite a bit of late but has very good seasonal news that I also share below in the Historical Tendencies section.

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