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SWS Daily Market Update - August 10, 2021


Markets were mixed today with the Dow up 0.46%, Nasdaq down a similar amount at – 0.49, caused by a decline in technology stocks, and SPX almost neutral at + 0.10. The Dow and SPX closed at record highs, with SPX up 18% this year and almost doubling from its low in March 2020.


The main catalyst was the Senate passing an infrastructure bill, although this still has to get through the house to become law. Its passage in the House is not assured. Energy stocks did very well, although this was largely a recovery from their drops on Monday. Materials and industrials also gained as they would benefit from the construction projects created by the infrastructure spending.


Second quarter earnings are now mostly in, and the results have been much better than predicted by analysts in April.


Worries about the continued increase in COVID infections, and the possibility of inflation remain but were not as prominent in investors minds on Tuesday.


The good earnings, along with government stimulus and low interest rates, have led to high stock valuations. The SPX is now trading at a forward P/E of 21 for the next twelve months, compared with a 5 year average of 18.5.


The Bureau of Labor Statistics reported that productivity in the second quarter (nonfarm business employee output per hour) rose 2.3% on an annual basis in the second quarter, below the estimated 3.2% and also below the 4.3% rate in the first quarter. Output increased by 7.9% and hours worked by 5.5%. Growth in productivity means that more goods can be produced without causing an increase in inflation. Unit labor costs rose at an annual rate of 1% in the second quarter, after a 2.8% decline in the first quarter. Hourly compensation increased by 3.3% and there was a 2.3% increase in productivity.


Markets

The SP 500 is down by 0.10% to close at 4436.75. The index is up 0.31% over five days, up 1.55% over one month, up 6.86% over three months and up 33.09% over one year.

The trailing P/E is 31.24 compared with 30.59 one year ago and estimated future P/E 22.37. Dividend yield is currently 1.33 compared with 1.90 one year ago.

Leading stocks were NUE up 9.58%, KSU up 7.47%, Sysco Corp. up 6.52%, APA up 6.42% and FCX up 4.83%.

Trailing stocks were MRNA down 5.72%, MU down 5.36%, ABMD down 4.02%, TFX down 3.95% and LRCX down 3.64%.


The Dow Jones industrial Average is up by 0.46% to close at 35264.67. The DOW is up 0.42% over five days, up 1.08% over one month, up 2.90% over three months and up 27.37% over one year.

The trailing P/E is 24.04 compared with 28.04 year ago and an estimated future P/E of 19.35. The current dividend yield is 1.78% compared with 2.29 one year ago.

Leading stocks were CAT up 2.48%, WMT up 2.13%, DOW up 2.10%, WBA up 2.09% and GS up 2.02%.

Trailing stocks were CRM down 2.38%, V down 0.80%, AXP down 0.76%, MSFT down 0.66%, and MCD down 0.52%.


The NASDAQ composite is down by 0.49% and closed at 14788.09. NASDAQ is up 0.18% over five days, up 0.75% over one month, up 10.45% over 3 months and up 37.14% over one year.

Leading stocks were FULC up 125.33%, MDIA up 36.30%, XGN up 24.59%, ORPH up 24.48% and ACHIL up 22.13%.

Trailing stocks were KPLT down 56.22%, IMPL down 25.87%, CXDC down 24.76%, SDC down 24.18%, and WTRH down 23.27%.


The MidCap SP400 is up by 0.35% to close at 2719.31. The SP400 is up 0.38% for the past 5 days, up 1.78% for the past month, up 0.23% for the past 3 months and up 39.80% over the past year.

Leading stocks were CAR up 7.76%, STLD up 6.04% and CLF up 5.05%.

Trailing stocks were SAIL down 8.87%, STAA down 6.14% and ELY down 5.82%


The SmallCap SP600 is up by 0.94% to close at 1357.11. The SP600 is up 0.89% for the past 5 days, up 1.35% for the past month, up 1.48% for the past 3 months and up 47.55% over the past year.

Leading stocks were DDD up 21.48%, LTHM up 12.33% and TMST up 11.20%.

Trailing stocks were FLGT down 11.32%, APEI down 9.89% and GKOS down 7.40%.


The CBOE VIX is up by 0.42% and closed at 16.79. The VIX is down 6.93% over five days, down 1.93% over one month, down 23.12% over three months and down 30.13% over one year.


On the New York stock exchange 1788 stocks advanced and 1525 declined, while on Nasdaq 2025 advanced and 2325 declined.

There were 160 new 52 week highs and 48 new 52 week lows on NYSE with 131 new highs and 109 new lows on NASDAQ.


The 2 year Treasury note yield is 0.240% and 10 year is 1.355%. The 10 year yield is up 17.0% over five days, up 0.9% over one month, down 34.6% three months ago, and up 99.46% one year ago.


SP500 Sector Performance % change

Energy +1.72

Materials +1.48

Industrials +1.01

Financials +1.01

Consumer Staples +0.70

Consumer Discretionary +0.25

Utilities +0.10

Communication Services +0.09

Health Care -0.24

Information Technology -0.73

Real Estate -1.09


Energy has been down 0.56% over five days, down 5.34% over one month, down 4.84% over three months and up 29.96% over one year.

Real Estate has been down 1.26% over five days, up 0.67% over one month, up 9.52% over three months and up 29.73% over one year.


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