March 1, 2018.
A sell-off at the end of the day led Wall Street sharply down on Wednesday, stock indexes dragged down by ongoing rate hike concerns. The Dow Jones and the S&P 500, in so doing, capped off their worst month since 2016. Furthermore, the S&P 500 cut a streak of 10 winning months, which was its longest winning streak since its 11-month rally between March 1958 and January 1959.
The indexes’ declines yesterday represented the conclusion of a month marked by jumps in volatility and fear that a rise in inflation could lead the Fed to increase its rate hike pace. The weakness at the end of the day was expressive of investors’ skepticism. We’ll always prefer to see strength in the last trading hour.
Energy stocks (XLE) fell against the backdrop of declines in crude which led the energy sector to be the worst-performing sector yesterday on the S&P 500. A breakdown of the 50-period EMA prompted further selling in the afternoon, the computerized algorithmic programs again responding to the technical breakdown that sparked market selling.
Daily Summary: The blue chip Dow fell 1.50%, the S&P 500 dropping 1.11%. The NASDAQ slipped 0.78%.
In summary for the month, the Dow Jones shed 4.3%. In February, the S&P 500 shed 3.9%, the NASDAQ settling for losses of 1.9%.
After a difficult February, stocks are entering the period which usually produces the best 2 months of the year. Historically, February is the third worst performing month for the S&P 500. Stocks are likely to recover in March but the challenge is the continued volatility revolving rising rates and inflationary concerns. The Federal Reserve is expected later in the month on March 21st to hike rates and release a new forecast for both inflation and rate hikes. The latter part of the forecast should signal whether this year’s hikes will come sooner than currently expected.
Historically, stocks have recorded gains in March two-thirds of the time; in April, the batting percentage was even higher, the market recording gains 69% of the time. Since the beginning of the bull market which began in 2009, on average the gains in March stood at a little less than 3%, double the long-term mean gains for March, i.e. 1.5% since 1983.
Traders are eyeing the 2,700 point level on the S&P 500. If we see this level broken down, many investors will lose the confidence they need to buy the correction. In the event the 2,700 point level falls to the bears, things could get messy – the market possibly testing February’s bottom at the 2,535 point level. What we would get then is a W pattern, not a V pattern.
Thursday’s Hot Stocks: BOX, MNST, DDD, LB, BID, KSS, BBY
Have a great trading day!
|Wednesday||10:00||Pending Home Sales Index||0.5 %||Medium|
|Wednesday||10:30||Oil Inventories||-1.6 M barrels||Low|
|Thursday||8:30||Jobless Claims||230 K||Medium|
|Thursday||8:30||Personal Income and Outlays||0.3 %||Medium|
|Thursday||9:45||PMI Manufacturing Index||55.7||Medium|
|Thursday||10:00||ISM Mfg Index||58.6||High|
|Thursday||10:00||Construction Spending||0.3 %||Medium|
|Thursday||10:00||Jerome Powell Speaks||–||High|
|Thursday||11:00||William Dudley Speaks||–||Medium|
|PANW||Palo Alto Networks, Inc.||PM||Monday|
|SBAC||SBA Communications Corporation||PM||Monday|
|BRK-A||Berkshire Hathaway Inc.||PM||Monday|
|CLVS||Clovis Oncology, Inc.||PM||Monday|
|IONS||Ionis Pharmaceuticals, Inc.||AM||Tuesday|
|EV||Eaton Vance Corp.||AM||Tuesday|
|DISCA||Discovery Communications, Inc.||AM||Tuesday|
|LAMR||Lamar Advertising Company (REIT)||AM||Tuesday|
|TOL||Toll Brothers, Inc.||AM||Tuesday|
|SERV||ServiceMaster Global Holdings, Inc.||AM||Tuesday|
|AMT||American Tower Corporation (REIT)||AM||Tuesday|
|PRGO||Perrigo Company plc||AM||Tuesday|
|EOG||EOG Resources, Inc.||PM||Tuesday|
|ESRX||Express Scripts Holding Company||PM||Tuesday|
|PCLN||Booking Holdings Inc.||PM||Tuesday|
|BUFF||Blue Buffalo Pet Products, Inc.||PM||Tuesday|
|JAZZ||Jazz Pharmaceuticals Public Limited Company||PM||Tuesday|
|VEEV||Veeva Systems Inc.||PM||Tuesday|
|ACAD||ACADIA Pharmaceuticals Inc.||PM||Tuesday|
|EVHC||Envision Healthcare Corporation||PM||Tuesday|
|WTW||Weight Watchers International, Inc.||PM||Tuesday|
|RRC||Range Resources Corporation||PM||Tuesday|
|HZNP||Horizon Pharma Public Limited Company||AM||Wednesday|
|DY||Dycom Industries, Inc.||AM||Wednesday|
|VRX||Valeant Pharmaceuticals International, Inc.||AM||Wednesday|
|LOW||Lowe’s Companies, Inc.||AM||Wednesday|
|TJX||The TJX Companies, Inc.||AM||Wednesday|
|ADI||Analog Devices, Inc.||AM||Wednesday|
|MNST||Monster Beverage Corporation||PM||Wednesday|
|LB||L Brands, Inc.||PM||Wednesday|
|BLUE||bluebird bio, Inc.||PM||Wednesday|
|BBY||Best Buy Co., Inc.||AM||Thursday|
|GPS||The Gap, Inc.||PM||Thursday|
|SRPT||Sarepta Therapeutics, Inc.||PM||Thursday|
|PSTG||Pure Storage, Inc.||PM||Thursday|
|FL||Foot Locker, Inc.||AM||Friday|
Today’s Picks – Day Trading!
New York Strategy Swing
Today’s Picks – Swing “New-York Strategy”
No.1 – MOMO
|Sector||Technology | Internet Software & Services|
Risk Rates: Normal – Regular size, High –Consider reducing size, Low – Consider increasing size