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SWS Daily Report - June 15, 2021


Overview


All the major indices dropped today, moving in response to a greater than expected drop in retail sales and a large jump in the producer price index. The markets are cautiously awaiting the communication from the Fed policy meeting tomorrow, looking for signs of any imminent change in monetary policy. Most think that the Fed will not change its plans but this could be affected but unexpected economic data. Real estate and technology stocks tended to do worst while energy climbed in anticipation of further increases in oil prices. The price of crude oil is now at a 30 month high.


Economy


The producer price index rose by 0.8% in May following a 0.6% rise in April and the 1.0% rise in March. The estimated increase for May was 0.5%. Year-over-year, the PPI increased by 6.6%, the largest rise since the data was 1st collected in November 2010. Even excluding the volatile food and energy, the annual increase was 5.3% which also was the largest on record. Demand for final goods was up by 1.5% and services by 0.6%.


Retail sales for May were down by -1.3% compared with April, with core sales, which exclude automobiles, gas and food services, down - 0.7%. (The core retail sales correspondent best to the consumer spending component of the GDP). The forecast declined in retail sales was -0.8%. The decline occurred in 8/12 of the major retail categories. Sales in April had risen by 0.9% compared with March.


Retail sales were up 28.1% from May 2020, and sales for the past 3 months were up 36.2% from one year ago.


The drop in May could signal a shift from consumption of goods to services as travel and entertainment open up.


Total industrial production in May was up 0.8%, with a 0.9% rise in manufacturing, mainly from automobiles. Industrial production was up 16.3% year-over-year, but still 1.4% lower than before the pandemic in February 2020. Capacity utilization was up 0.6% to 75.2%. This is still 4.4% below the long term average.


The National Association of Home Builders housing market index dropped by – 2 to 81 compared the expected no change of 83. This represents a 10 month low.


Markets

The SP 500 dropped by 0.20% to close at 4246.59. The index has been up 0.46% over five days, up 2.88% over one month, up 7.16% over three months and up 35.90% over one year.


The trailing P/E is 37.39 compared with 26.28 one year ago and estimated future P/E 22.47. Dividend yield is currently 1.36 compared with 2.00 one year ago.


Leading stocks were FANG up 5.10%, OGN up 5.05%, NOV up 4.16%, XOM up 3.64% and OXY up 3.25%.


Trailing stocks were ARE down 5.07%, FCX down 4.76%, TTWO down 4.36%, VRTX down 2.99% and TSLA down 2.97%.


The Dow Jones industrial Average was down 0.2% to close at 34299.33. The DOW is down 0.87% over five days, up 0.70% over one month, up 4.49% over three months and up 30.47% over one year.


The trailing P/E is 29.25 compared with 22.20 year ago and an estimated future P/E of 20.27. The current dividend yield is 1.82% compared with 2.46 one year ago.


Leading stocks were CVX up 2.16%, AXP up 1.50%, TRV up 0.89%, BA up 0.59% and DOW up 0.39%.


Trailing stocks were JPM down 1.52%, CRM down 1.49%, DIS down 1.30%, HD down 0.93% and NKE down 0.81%.


The NASDAQ composite is up 0.71% and closed at 14072.86. NASDAQ has been up 1.06% over five days, up 5.78% over one month, up 4.46% over 3 months and up 42.21% over one year.


Leading stocks were ALF up 104.40%, TRCH up 41.62%, CLSD up 37.75%, PETZ up 18.96% and FUSN up 18.14%


Trailing stocks were PDSB down 28.46%, NXTD down 20.90%, SAGE down 19.30%, RCAT down 17.90% and AVXL down 17.39%


The MidCap SP400 dropped 0.09% to close at 2724.03. The SP400 has been down 0.95% for the past 5 days, up 1.25% for the past month, up 2.91% for the past 3 months and up 49.39% over the past year.

Leading stocks were CHX up 4.93%, GT up 3.77% and MUR up 3.68%.


Trailing stocks were RUN down 6.46%, CDAY down 5.15% and AMED down 4.90%


The SmallCap SP600 was up 0.23% to close at 1390.45. The SP600 has dropped 1.67% for the past 5 days, up 3.63% for the past month, up 1.23% for the past 3 months and up 63.55% over the past year.


Leading stocks were OIS up 9.7%, BCOR up 8.26% and NBR up 6.06%.


Trailing stocks were IVR down 7.21%, WRE down 6.49% and HIBB down 5.72%.


The CBOE VIX rose 3.84% and closed at 17.02. The VIX is down 0.29% over five days, down 20.24% over one month, down 14.00% over three months and down 49.45% over one year.


On the New York stock exchange 1565 stocks advanced and 1747 declined, while on Nasdaq 1619 advanced and 2682 declined.


There were 183 new 52 week highs and 14 new 52 week lows on NYSE with 137 new highs and 20 new lows on NASDAQ.


The 2 year Treasury note yield is 0.17% and 10 year is 1.50%. The 10 year yield was down 10.47% one month ago, down 8.80% three months ago, 0.90% six months ago and up 104.37% one year ago.


SP500 Sector Performance % change

Energy + 2.06

Industrials + 0.47

Utilities + 0.35

Financials + 0.23

Health Care - 0.03

Materials - 0.20

Consumer Staples - 0.28

Consumer Discretionary - 0.47

Consumer Services - 0.49

Information Technology - 0.64

Real Estate - 1.04


Energy has been up 0.59% over five days, up 5.16% over one month, up 9.29% over three months and up 36.48% over one year.


Real Estate has been down 0.11% over five days, up 7.37% over one month, up 15.05% over three months and up 24.76% over one year.


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