Reports of a trade agreement between the U.S. and China pushed global stock prices sharply higher today. Chart 1 show the S&P 500 reaching record territory. So did the Nasdaq. Small cap stocks continued to show relative strength. Chart 2 shows the Russell 2000 iShares (IWM) hitting another 52-week high. Eight of eleven stock sectors rose today with financials, technology, and healthcare hitting new records. Energy stocks also had another strong day. While materials hit the highest level in nearly two years (more on that shortly). The three sectors in the red were staples, utilities, and REITS. Those bond proxies were also hurt by a big jump in bond yields which pushed the 10-Year Treasury yield to the highest level in a month. Chart 3 shows the 10-Year Treasury yield jumping 10 basis points to 1.90%. That helped make financials the day's strongest sector which were led higher by banks, life insurers, and asset managers.
About the author:John Murphy is the Chief Technical Analyst at StockCharts.com, a renowned author in the investment field and a former technical analyst for CNBC, and is considered the father of inter-market technical analysis. With over 40 years of market experience, he is the author of numerous popular works including “Technical Analysis of the Financial Markets” and “Trading with Intermarket Analysis”. Before joining StockCharts, John was the technical analyst for CNBC-TV for seven years on the popular show Tech Talk, and has authored three best-selling books on the subject: Technical Analysis of the Financial Markets, Trading with Intermarket Analysis and The Visual Investor.