Third Quarter Off To A ‘Bang’ Just Before 4th Of July Holiday

Ulli Market Commentary Contact

Tue pic

[Chart courtesy of]

1. Moving The Markets

The markets opened the third quarter with a bang as the S&P 500 and Dow both climbed record highs at closing. The Dow was within 2 points of hitting 17,000 for the first time ever before pulling back slightly. The S&P 500 gained 0.7% to close at an all-time high of 1973.32. But, let’s not forget the tech loving Nasdaq that also gained 0.7% today to close at a new 14-year high.

The bullish trading activity today came about despite weaker-than-expected readings on manufacturing in June and construction spending in May. An index of U.S. manufacturing activity unexpectedly fell slightly last month as production dipped. This data seemed to be of little importance to the broader market though as sentiment remained largely positive.

Health care stocks had the biggest advance with gains led by Regeneron (REGN). The company rose $19.53, or 7 percent, to $301.94 after French drugmaker Sanofi (SNY) said in a regulatory filing that it had raised its stake in Regeneron.

General Motors (GM) was able to ‘save face’ a bit today. The stock rose the most in almost a month despite a record-setting string of safety recalls. The automaker reported that its U.S. sales and recalls? increased 1 percent in June.

Our ETFs in the Spotlight joined the rally welcoming the month of July with 6 of them making new highs for the year.

2. ETFs in the Spotlight

In case you missed the announcement and description of this section, you can read it here again.

It features 10 broadly diversified ETFs from my HighVolume list as posted every Monday. Furthermore, they are screened for the lowest MaxDD% number meaning they have been showing better resistance to temporary sell offs than all others over the past year.

In other words, none of them ever triggered their 7.5% sell stop level during this time period, which included a variety of severe market pullbacks but no move into outright bear market territory.

Here are the 10 candidates:


All of them are in “buy” mode, meaning their prices are above their respective long term trend lines by the percentage indicated (%M/A).

Year to date, here’s how the above candidates have fared so far:


To be clear, the first table above shows the position of the various ETFs in relation to their respective long term trend lines (%M/A), while the second one tracks their trailing sell stops in the “Off High” column. The “Action” column will signal a “Sell” once the -7.5% point is taken out in the “Off High” column.

3. Domestic Trend Tracking Indexes (TTIs)

Our Trend Tracking Indexes (TTIs) joined the bulls and closed higher:

Domestic TTI: +4.01% (last close +3.65%)

International TTI: +4.78% (last close +4.14%)

Disclosure: I am obliged to inform you that I, as well as advisory clients of mine, own some of these listed ETFs. Furthermore, they do not represent a specific investment recommendation for you, they merely show which ETFs from the universe I track are falling within the guidelines specified.

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