ETF Tracker StatSheet
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MARKET AWAITS KEY MACRO EVENTS AFTER WEEK OF MIXED PERFORMANCES
- Moving the market
Today, stocks staged a notable comeback, attempting to recover some of the declines experienced earlier in the week as traders analyzed the latest inflation data.
Several factors contributed to this rebound: Market sentiment was oversold, Thursday’s GDP report exceeded expectations, and there is growing optimism that the Federal Reserve may soon soften its interest rate policy.
June’s Personal Consumption Expenditure Price Index (PCE) rose by 0.1% month-over-month and 2.5% year-over-year, both figures aligning with estimates and providing no negative surprises.
Traders continued to rotate into cyclical sectors and Small Caps, which gained an additional 2%. Industrials, real estate, and financials also showed signs of recovery. The Dow led the charge with a 1.6% gain, partly driven by 3M’s impressive 20% surge, marking its best day since 1972.
The tech sector, however, faced a challenging period, with the MAG 7 stocks losing approximately $2 trillion in market value. Small Caps outperformed the Nasdaq, adding 3% while the Nasdaq lost 3%, a scenario reminiscent of the dotcom bubble peak.
Bond yields slipped as expectations for rate cuts increased slightly. The dollar edged higher, gold rebounded but closed lower for the week, and Bitcoin showed a mixed performance, bouncing back strongly to touch the $68k level. Meanwhile, oil prices declined.
Next week promises to be the busiest of the summer, with numerous macro events on the horizon, including the Federal Reserve meeting, CPI data, and earnings reports from 40% of the S&P 500 companies. These events are likely to significantly influence market direction.
But which way will the market go?
2. Current “Buy” Cycles (effective 11/21/2023)
Our Trend Tracking Indexes (TTIs) have both crossed their trend lines with enough strength to trigger new “Buy” signals. That means, Tuesday, 11/21/2023, was the official date for these signals.
If you want to follow our strategy, you should first decide how much you want to invest based on your risk tolerance (percentage of allocation). Then, you should check my Thursday StatSheet and Saturday’s “ETFs on the Cutline” report for suitable ETFs to buy.
3. Trend Tracking Indexes (TTIs)
The major indexes made a robust recovery, effectively recouping some of the losses experienced earlier in the week. The S&P 500 has now returned to the level it was at the beginning of the month.
Our TTIs capitalized on this rally, showing significant advancement.
This is how we closed 07/26/2024:
Domestic TTI: +6.59% above its M/A (prior close +5.73%)—Buy signal effective 11/21/2023.
International TTI: +5.80% above its M/A (prior close +5.38%)—Buy signal effective 11/21/2023.
All linked charts above are courtesy of Bloomberg via ZeroHedge.
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