U.S. economic data Tuesday was strong as PMI Mfg Index beat at 57.9 vs 57.8 expected & prior 55.8; ISM Mfg Index beat 59.0 vs 56.8 expected & prior 57.1; and, Construction Spending rose to 1.8% vs 0.9% expected & prior -0.9%. Meanwhile in Europe the most anticipated stimulus package since the invention of the printing press is Draghi’s and the ECB’s stimulus roll-out. The delay has made the event old news perhaps leading to a “sell the news” type of event.
Meanwhile U.S. stocks spent the first trading day of September meandering between gains and losses ending the day mixed with tech (QQQ) rising while other major indexes close with slight losses. Significant losses were noted in gold, energy and other commodities as the dollar rose with better economic data.
Leading market sectors higher included: Small Caps (IWM), Banks (KBE), Regional Banks (KRE), Transports (IYT), Retail (XRT), China (FXI), Brazil (EWZ), India (EPI), Japan (EWJ), Japan Hedged (DXJ), Latin America (ILF), Dollar (UUP), Base Metals (DBB) Agriculture (DBA) and Brazil Small Caps (BRF).
Leading market sectors lower included: Gold Miners (GDX), Gold (SLV), Metals & Miners (XME), Energy (XLE), Utilities (XLU), Russia (RSX), Natural Gas (UNG), Crude Oil (USO), South Korea (EWY), Taiwan (EWT), UK (EWU) and Bonds (TLT).
The top 20 market movers by percentage change in volume whether rising or falling is available daily.
Volume remains light while breadth per the WSJ was mixed.
Is good economic data what the bulls really want? It’s quite the conundrum.
On the one hand good economic data is lifting indexes but tentatively.
At the same time, bulls don’t want interest rate increases sooner. Currently the stronger dollar is helping to keep a lid on prices which holds back the Fed from raising rates.
Wednesday features the first of the important employment reports with the ADM Employment Report. This is starting to become more reliable since they changed their methodology. Factory Orders are also on tap and those are another important gauge of the economy’s strength. Also the Fed’s Beige Book will reveal some aspects of economic strength/weakness by various Fed districts.
Dave Fry is founder and publisher of ETF Digest and has been covering U.S. and global ETFs since 2001.
He is the author of "Create Your own ETF Hedge Fund: A Do-It-Yourself Strategy for Private Wealth Management" published by Wiley Finance and "The Best ETFs: U.S. Equities, A Companion Guide to Building Your ETF Portfolio".
Disclaimer: The charts and comments are only the author's view of market activity and aren't recommendations to buy or sell only any security. Market sectors and related ETF's are selected based on his opinion as to their importance in providing the viewer a comprehensive summary of market conditions for the featured period. Chart annotation's aren't predictive of any future market action rather they only demonstrate the author's opinion as to a range of possibilities going forward. More detailed information, including actionable alerts, are available to subscribers at www.etfdigest.com
|WTI Crude Futr||93.25||0.37||0.40 %||21:59|
|US Dollar||82.99||0.00||0.00 %||17:00|
|Brazil||2698.772||0.43 %||0.24 %||21.67 %|
|Russia||641.044||-0.14 %||-1.20 %||-18.53 %|
|India||515.282||0.31 %||1.39 %||26.51 %|
|China||66.248||0.20 %||0.18 %||4.98 %|