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SWS Daily Market Update - Aug 2, 2021


Overview

The markets ended lower today after starting strong, seemingly worried about the falling 10 year treasury yield that could indicate concerns about growth. This drop in long term rates is resulting in a flattening of the yield curve is suggestive of slowing growth. Combined with the ongoing inflation possibility and the surge in delta variant COVID infections, some investors may be locking in profits in this era of extremely high stock valuations. The SPX has risen for six straight months. August is historically weak month for the stock market and so far is starting in this manner this year. The 10 year Treasury yield ended down at 1.173%.


The Commerce department reported that construction spending increased by 0.1% in June, with the increase coming in the private sector while public spending dropped. The estimate had been for a 0.5% increase. The value for May was a - 0.2% drop. Spending was up 8.2% compared with June 2020. Construction spending accounts for 3-4% of GDP.


The Institute for Supply Management’s PMI (manufacturing) for July dropped 1.1% to a value of 59.5%. A value above 50, which indicates the economy is expanding, has been present since April 2020. Growth occurred in 17 of 18 manufacturing industries. The New Orders index was 64.9, down 1.1% from June, the Production Index dropped 2.4 to 58.4% and the Prices Index was 85.7, down from 92.1 in June which had been the highest value since July 1979. Companies reported ongoing difficulties due to supply chain restrictions and labor shortages. Demand remains high. ​


Markets

The SP 500 dropped by 0.18% to close at 4387.16. The index is down 0.79% over five days, up 0.80% over one month, up 4.64% over three months and up 33.16% over one year.

The trailing P/E is 33.75 compared with 30.59 one year ago and estimated future P/E 22.52. Dividend yield is currently 1.31 compared with 1.90 one year ago.

Leading stocks were DXC up 6.58%, FTNT up 4.55%, RL up 3.94%, UA up 3.31% and TSLA up 3.27%.

Trailing stocks were GPN down 11.18%, FNF down 6.66%, FISV down 4.66%, GNRC down 4.62% and MOS down 4.19%.


The Dow Jones industrial Average dropped by 0.28% to close at 34838.16. The DOW is down 0.87% over five days, up 0.15% over one month, up 2.13% over three months and up 30.65% over one year.

The trailing P/E is 23.51 compared with 25.37 year ago and an estimated future P/E of 19.45. The current dividend yield is 1.80% compared with 2.45 one year ago.

Leading stocks were GS up 0.88%, UNH up 0.81%, NKE up 0.74%, IBM up 0.33% and CSCO up 0.14%.

Trailing stocks were V down 2.68%, DOW down 1.51%, MCD down 1.08%, MRK down 0.90%, and CAT down 0.77%.


The NASDAQ composite is up by 0.06% and closed at 14681.07. NASDAQ is down 1.08% over five days, up 0.29% over one month, up 5.66% over 3 months and up 34.65% over one year.

Leading stocks were EVK up 124.78%, DLPN up 55.87%, INFI up 38.21%, XCUR up 34.07% and ATCX up 27.92%.

Trailing stocks were EJH down 28.28%, IMVT down 26.00%, OPHC down 23.15%, TGTX down 21.63%, and EVGO down 16.16%.


The MidCap SP400 dropped by 0.43% to close at 2692.01. The SP400 is up 0.60% for the past 5 days, down 0.65% for the past month, down 1.76% for the past 3 months and up 42.85% over the past year.

Leading stocks were SLAB up 4.05%, CAR up 3.83% and JWN up 3.63%.

Trailing stocks were XPO down 39.47%, TDS down 9.80% and TKR down 5.96%


The SmallCap SP600 dropped by 0.47% to close at 1334.95. The SP600 is up 0.37% for the past 5 days, down 2.54% for the past month, down 1.91% for the past 3 months and up 52.36% over the past year.

Leading stocks were LPG up 7.85%, DBD up 7.68% and ZYXI up 5.83%.

Trailing stocks were PETS down 5.48%, CSII down 5.09% and PVAC down 5.08%.


The CBOE VIX is up by 6.69% and closed at 19.46. The VIX is up 10.69% over five days, up 29.13% over one month, up 6.28% over three months and down 19.85% over one year.


On the New York stock exchange 1549 stocks advanced and 1788 declined, while on Nasdaq 2248 advanced and 2131 declined.

There were 209 new 52 week highs and 27 new 52 week lows on NYSE with 148 new highs and 62 new lows on NASDAQ.


The 2 year Treasury note yield is 0.172% and 10 year is 1.178%. The 10 year yield is down 6.9% over five days, down 17.3% over one month, down 41.5% three months ago, and up 67.0% one year ago.


SP500 Sector Performance % change

Utilities +0.75

Consumer Discretionary +0.28

Health Care +0.17

Real Estate +0.01

Financials -0.08

Communication Services -0.19

Consumer Staples -0.29

Information Technology -0.37

Energy -0.71

Industrials -0.72

Materials -1.17


Utilities has been up 1.09% over five days, up 3.73% over one month, down 0.37% over three months and up 10.48% over one year.


Materials has been up 0.69% over five days, up 0.16% over one month, down 1.48% over three months and up 38.11% over one year.


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