It was a relief trading day on Friday, particularly with the S&P and the NASDAQ pushing to the upside. The NASDAQ Composite was leading the way higher up over two percent. Upon Fridays close, it seems that It was the beginning of a broader recovery. The Dow Jones Industrial Average sank 1.2% in last weeks market trading.
The Market Week That Was – Dow Jones NASDAQ and S&P
At the backdrop, it was a week that began with choppy markets for the first couple of days, then a Federal meeting during the week saw the markets finishing and resolving to the upside. This saw the S&P and the NASDAQ actually push higher, quite a bit.
On Fri, U.S. jobs data gave a new hope to the economic outlook. Investors were a lot consoled with Mike Powell signalling that Federal Reserve may well pause the trend of rate hikes, going forward. U.S. Jobs report, in the non-farms payroll report showed addition of 253,000 new jobs in April. That was up from 165,000 in March and exceeded expectations of 180,000.
Over the course of the week, in the last five trading days, the markets saw a lot of upside. On Fri,the S&P was up almost 2 percent, finishing the day about 1.9 percent to the upside. This was after pulling back in the last hour, because that’s usually when a lot of institutional volume will be at the end of the day pretty happily booking their profits.
Interestingly, NASDAQ was leading the way higher with almost 2.25 percent up. For the NASDAQ Composite, Mid Caps and Small Caps were all up as well. We could see the Mid Cap S&P 400 Index Up about 2.1 percent, Small Caps was up almost 2.4 percent.
The VIX which was once touching 20 and above 20, all of a sudden dropped on Fri to almost 3 full points, to finish the day around 17.2.
Bond Yields
Yields are the inverse of bond prices and so, when prices are going lower yields are going higher. Bond price is moving the Yield curve lower. Interest rates are going higher, the short end of the curve came up a little bit. It was really more of the long end of the curve so investors selling treasury bonds were bringing yields up quite a bit.
We could see the 10-year yield around 345, the long bond yield around 376. We still have that inverted yield curve now and that has been in place for quite some time which is often a great indicator of a recession.
Currency
Dollar Index did not see too much of a change from Thu. One of the interesting movement in the commodity space is the strength in Gold and Silver and the weakness in things like Crude Oil, Natural Gas that have been showing weakness to the downside, until now. But, on Fri, we saw the opposite and what we saw was Gold and Silver, both were down, about 1.5 percent, Crude Oil prices were up about 3-4 four percent
Cryptocurrency
Crypto was all in the green. Bitcoin prices were up, over 2 percent, Ether price was up, about 6 percent. Ether got very close to that 2000 level, which is a big round number. Bitcoin had once got closer to 30 thousand. It’s a level that Bitcoin had broken above but, it’s been below that now for a little while.
Sector Performance – Markets This Week Dow Jones NASDAQ and S&P
Energy, Financials were the sectors, we could see were really working on Fri. Technology has been working overall but Financials and Energy have been two just dog areas of the market that were pushing to the upside on Fri. On Fri, Healthcare and Consumer Staples had some really strong ups as well and were found to be amongst the Top.
While talking about sectors, Energy was the top performing sector with 2.8 percent, Technology was up, about 2.5 percent, Financials was up about 2.4 percent. These are the top three sectors. Two of these 3 sectors, namely Energy and Financials have been the worst performing sectors until now.
Year to date, we have seen a lot of weakness in Financials which is of course due to the ongoing Banking crisis whereas, Energy sector is because of Crude Oil prices that have been consistently weak. All this while we had been seeing Energy stocks breaking Down, but not breaking Out. The Inverse is what we saw through the course of the day on Fri.
On the downside some defensive sectors which were found at the bottom of the performance list was Utilities. Utilities was still up .6 percent, but underperforming.
Weekly Performance
The S&P, was up about about 1.5-2 percent. When we talk about the Major benchmarks, and try to compare the last two weeks market performance, we find that the S&P 500 was down about .8 percent from last Friday’s close. Couple of things also underperformed. In Red, we have bond prices. The TLT finished the week down 1.2 percent. Therefore, it’s interesting that stocks and bonds are both about the same and both are down about 1-1.25 percent, for the week.
We then had Crude Oil prices, which again rotated higher. This was a newer version move from the deterioration that we have seen for quite some time. Leading up into Wednesday’s trade, Crude had been down over 10 percent.
For the last week, we recovered quite a bit from that downfall but, Crude still finished down about 6.6 percent, last week. Everything else outperformed the S&P. We have Small Cap stocks and the US Dollar that were both down about .4 percent. They were both just narrowly in the positive with Friday’s rally.
The NASDAQ 100 finished up just about 0.1 percent and in a sense remained unchanged. We have Emerging markets and Bitcoin that were both, up about point seven percent for the week.The top performer even with Friday’s pullback was Gold, which was up 1.4 percent.
Talking about the Fang stocks, we saw Apple having a very strong day. Two of the Mega Cap Tech stocks like Apple was up about 4.7 percent, Microsoft was up about 1.7, Nvidia was also up about 4.1 percent. Adobe was also up about 3.7 percent and that was unique just for today.
Apple performance was driven by its earnings. Apple was up because of good iPhone sales and they also announced a decent corporate buyback. Apple up almost five percent is a pretty decent update. Other Tech names were up as well. With some Semiconductors stocks that had been struggling a bit util recently, were now seen moving back to the upside and therefore, Nvidia moving up by 4 percent is no joke.
