Stock Market Today: December 7th - 11th, 2020

Discussion in 'Stock Market Today' started by Stockaholic, Dec 4, 2020.

  1. Stockaholic

    Stockaholic Content Manager

    Joined:
    Mar 29, 2016
    Messages:
    13,767
    Likes Received:
    7,050
    Welcome Stockaholics to the trading week of December 7th!

    This past week saw the following moves in the S&P:
    [​IMG]

    Major Indices End of Week:
    [​IMG]
    [​IMG]

    Major Futures Markets on Friday:
    [​IMG]

    Economic Calendar for the Week Ahead:
    [​IMG]

    What to Watch in the Week Ahead:

    • Monday

    3:00 p.m. Consumer credit

    • Tuesday

    6:00 a.m. NFIB survey

    8:30 a.m. Productivity and costs

    10:00 a.m. QFR

    • Wednesday

    10:00 a.m. Wholesale trade

    10:00 a.m. JOLTS

    • Thursday

    8:30 a.m. Initial jobless claims

    8:30 a.m. CPI

    10:00 a.m. QSS

    2:00 p.m. Federal budget

    • Friday

    8:30 a.m. PPI

    10:00 a.m. Consumer sentiment

    12:40 p.m. Fed Vice Chairman Randal Quarles
     
    T0rm3nted likes this.
  2. Stockaholic

    Stockaholic Content Manager

    Joined:
    Mar 29, 2016
    Messages:
    13,767
    Likes Received:
    7,050
    Stocks Soar To Record Highs As Dollar Dumps After Dismal Data
    Before we start, let's get one thing straight... the US economy is going south fast as the labor market nears its weakest of the year, retail is tumbling, and even 'soft' survey hope is rolling over... those are the 'sciency facts'...

    [​IMG]

    Source: Bloomberg

    But, as always, bad news is the best news as it merely forces the hands of our benevolent central planners to do more sooner... and so stocks soared...

    [​IMG]

    “It’s a weaker report than expected,” Jeffrey Rosenberg, BlackRock Inc. senior portfolio manager, said in an interview on Bloomberg Ratio and Television. “The market reaction has been looking through this to the policy response. This week we have a lot of acceleration in terms of movement on that and this is the kind of news the market is interpreting as pushing them over the finish line.”

    The early week relative strength of Nasdaq was erased as Small Caps ripped back to end the week...

    [​IMG]

    It's a mad world alright...





    [​IMG]

    Source: Bloomberg

    Energy stocks soared on the week (thanks to a huge spike today), outperforming its peers once again as Utes lagged...

    [​IMG]

    Source: Bloomberg

    “The market is betting that we’ll get a relief package soon,” said Matt Maley, chief market strategist at Miller Tabak + Co. “If anything, this weaker report will get them to agree on a package sooner rather than later.”

    And that is nowhere more evident than the collapse in demand for protection, with the Put-Call ratio plunged to a decade lows (the indicator’s five-day moving average has hit its lowest level in 20 years)...

    [​IMG]

    Source: Bloomberg

    And as Bear Traps Report highlights, one of our Lehman 21 Systemic Risk Indicators, the spread between the 2 and 8 month VIX futures contract is back in negative territory.

    [​IMG]

    Source: Bloomberg

    This shows the volatility futures curve is back in its usual Contango state (back months higher than front months). Deep contango (under -2.50) means money managers don't feel the need to pay for upside vol in the near-term. For now, we remain in our 'danger zone'. Even with the put/call ratio at decade lows, managers are paying-up for near-term equity protection (2 months vol) relative to long-term protection.

    The Virus Fear Trade signals that all 'fear' is almost gone, accelerating lower post-vaccine. Which is a little odd given that over 20 million Americans remain on unemployment benefits...

    [​IMG]

    Source: Bloomberg

    And as stocks rallied, credit spreads have collapsed to the point where the compensation for risk has been crushed to record lows...

    [​IMG]

    Source: Bloomberg

    The bond market was battered this week with the long-end up over 16bps (2Y unch)...

    [​IMG]

    Source: Bloomberg

    With 10Y pushing to its highest yield (98.4bps) since March (but notably a key resistance level)...

    [​IMG]

    Source: Bloomberg

    Remember, at 1.02%, all hell breaks loose in CTA-land.

    30Y Yields also reached up to significant resistance at 1.75% (election and vaccine spike highs) before rolling over today...

    [​IMG]

    Source: Bloomberg

    And if the cyclical stock surge is to be believed, 10Y yields should be around 2.75%... which would break the world!

    [​IMG]

    Source: Bloomberg

    The yield curve (2s30s) steepened by the most since August this week, to its steepest since May 2017...

    [​IMG]

    Source: Bloomberg

    The dollar continued its collapse this week (down 4 of the last 5 weeks)...

    [​IMG]

    Source: Bloomberg

    As the euro soars...

    [​IMG]

    Source: Bloomberg

    The Loonie surged to its strongest since May 2018...

    [​IMG]

    Source: Bloomberg

    And offshore yuan is at its strongest since June 2018...

    [​IMG]

    Source: Bloomberg

    Cryptos were all higher on the week...

    [​IMG]

    Source: Bloomberg

    Bitcoin managed to hold $19k after reaching record highs earlier in the week...

    [​IMG]

    [​IMG]

    ...with WTI trading above $46 - its highest since early March...

    [​IMG]

    Source: Bloomberg

    Gold futs bounced back notably off intraweek lows, back above $1800 and its 200DMA (after 3 down weeks in a row)...

    [​IMG]

    Silver was the week's big winner (after 3 straight losing weeks), rebounding strongly off a brief dip to a $21 handle...

    [​IMG]

    Copper's recent massive outperformance over gold has decoupled commodities from bonds...

    [​IMG]

    Source: Bloomberg

    And finally, by Yale professor Robert Shiller's cyclically adjusted price-to-earnings ratio, U.S. stock valuations are back above their peak seen in 1929, just before the Great Depression...

    [​IMG]

    Source: Bloomberg

    And those who are hoping to find more greater fools to hand their 'winners' off to better hope for more and more deflation as multiples won't hold up well if the 'hopes' of inflation come to fruition...

    [​IMG]

    Be careful what you wish for!
     
    T0rm3nted likes this.
  3. Stockaholic

    Stockaholic Content Manager

    Joined:
    Mar 29, 2016
    Messages:
    13,767
    Likes Received:
    7,050
    Here are the percentage changes for the major indices for WTD, MTD, QTD & YTD in 2020-
    [​IMG]
    [​IMG]

    S&P sectors for the past week-
    [​IMG]
     
  4. Stockaholic

    Stockaholic Content Manager

    Joined:
    Mar 29, 2016
    Messages:
    13,767
    Likes Received:
    7,050
    Stocks and Bonds Both in Rally Mode
    Tue, Dec 1, 2020

    When it comes to equity market performance in a given month, it doesn't get much better than November. While the S&P 500's total return of 10.95% in the month was only the second-best monthly performance of the year, it was still enough to rank as the third-best month for the S&P 500 in the last thirty years and just the ninth month since 1980 that it was up 10%+.

    The chart below shows the S&P 500's annualized total return over the last one, two, five, ten, and twenty years and compares the current returns to the historical average. For the last year, the S&P 500's total return has been 17.5% which is nearly six full percentage points higher than the historical average. For the last two years, the annualized return has been nearly as strong at 16.8%, and it is actually even stronger relative to the historical average of 10.5%. Moving further out the time horizon, the S&P 500's annualized returns drift lower, and while the five and ten-year annualized returns are greater than average, the S&P 500's annualized gain of 7.3% in the last 20 years is more than 3.5 percentage points below the historical average of 10.9%.

    [​IMG]

    The last couple of years haven't just been strong for equities. Over the last year, long-term US Treasuries, as measured by the Merrill Lynch 10+ Year US Treasury Index, have rallied 15.7%, which is more than six full percentage points greater than the historical average of 9.5%. Over the last two years, returns have been even stronger with an annualized gain of nearly 20%, or more than double the historical average of 9.1%! While the last two years have been strong for US Treasuries, the last five, ten, and twenty years have all seen returns of between one and two percentage points below their historical average.

    [​IMG]

    Lately, when you see rallies in the equity market, it tends to be accompanied by a decline in treasuries as yields rise. In November, though, that wasn't the case. Even with the S&P 500 up 10.95%, long-term US Treasuries rallied just over 1%. So how uncommon is it for stocks to rally like they did in November while bonds also rally. Actually, it is not very uncommon at all. The table below shows the nine months since 1980 where the S&P 500's total return in a given month was 10% or more, and of those months, long-term treasuies also rallied in every month but one (October 2011).

    [​IMG]

    Manufacturer Recovery Continues
    Tue, Dec 1, 2020

    This morning, the Institute for Supply Management (ISM) released a less positive outlook for the US manufacturing sector. The headline number for ISM's Manufacturing index fell from 59.3 last month down to 57.5. A drop was expected, but the actual results were worse than the drop to 58.0 that had been forecasted. That reading indicates that the manufacturing sector continued to grow in November but at a slower rate than October.

    [​IMG]

    Similar to the various Federal Reserve bank surveys from around the country, breadth in the November report was more negative than in recent months. Of the ten indices excluding the headline number, only three were higher in November: Backlog Orders, Supplier Deliveries, and Export Orders. Additionally, two indices—Customer Inventories and Employment—showed contractionary readings.

    [​IMG]

    One theme of the report was that orders remain very healthy. New Orders fell from 67.9 to 65.1, but that is a sixth consecutive month of expansionary readings. Although the index was lower this month, meaning new order growth decelerated, it remains in the top decile of historical readings. As new orders have continued to grow, so too have backlogs. The index for Backlog Orders has continued to press higher, rising to 56.9 from 55.7. That is in the 88th percentile of all months and is now at the highest level since August of 2018. Demand continues to improve with new orders coming in at a historically strong pace, even though it is slower than last month, and order backlogs have once again risen as a result.

    [​IMG]

    As new order growth decelerated, so too did production. The index fell from 63.0 in October to 60.8 last month. That is still consistent with growth (readings above 50) in production but at the slowest rate since June. One factor that potentially had an impact on the slowdown in production is issues with suppliers. The index for Supplier Deliveries rose for the fourth month in a row in November and reached the highest level since May. Higher readings in the Supplier Deliveries index indicates longer lead times and vice versa. In other words, products from suppliers have been taking longer to reach manufacturers, in turn, impacting productivity.

    [​IMG]

    Although suppliers appear to have some constraints and production has slowed slightly, business inventories rose for the second month in a row even as more and more firms report that customer inventories are too low. The index for Customer Inventories now sits in the bottom 2% of historical readings after dropping another 0.4 points in November. At 36.3, the index is at the lowest level since June of 2010. That low reading can be considered positive for future production.

    [​IMG]

    Big Gains In November Steal From Santa

    What a month November was! Here are some of the highlights:
    • Best month for Dow since January 1987 (11.9%) and best November since 1928
    • Best month ever for the STOXX 600 (16.7%)
    • Best month ever for the Russell 2000 (18.3%)
    • Best month for the S&P 500 (10.8%) and Nasdaq (11.8%) since April 2020
    • Best month for Dow Transports since October 2011 (12.1%)
    • Best month from PHLX Semiconductor Index since March 2003 (18.4%)
    • Best month for Industrials (16.0%) and Financials (16.8%) since April 2009
    • Second best month ever for energy (28.0%)*
    “A way better than expected earnings season, a likely split Congress, and major breakthroughs on the vaccine front all helped stocks soar last month,” explained LPL Financial Chief Market Strategist Ryan Detrick. “Add ongoing support from the Federal Reserve as the cherry on top and we are looking at a truly historic month on many levels.”

    Here’s all the Dow monthly returns since 1900. Last month was the best return since January 1987. Now before you go out and sell because you see 1987, remember the S&P 500 added another 20% the seven months after the huge gains in early 1987.

    [​IMG]

    It was the best November for the S&P 500 since November 1928.

    [​IMG]

    Small caps soared on the likelihood of taxes staying lower due to a divided Congress and vaccine progress, with the Russell 2000 adding more than 18% for the best month ever, topping the previous record from February 2000.

    [​IMG]

    What happens after a big month? Well, history says a 10% monthly gain is quite bullish. In fact, we had a 10% plus rally back in April 2020 and shared this same chart at that time. Sure enough, returns have been strong this time around as well. “The bottom line is the huge gains in November could actually be the start of something much stronger,” according to Ryan Detrick. “Also, this was the second month of 2020 with a 10% gain. The only other year to do that? 1982, which kicked off a historic bull market.”

    [​IMG]

    Turning to December, this month is widely known to be quite bullish, as Santa comes to town, people feel good, and stocks tend to do well. As shown in the LPL Chart of the Day, since 1950, December has been the second best month of the year, with only November better. December had been the best month of the year until the historic 9.2% drop in 2018. As a result, December hasn’t been quite as strong over the past 10 and 20 years.

    [​IMG]

    Breaking it down even more, a big rally in November can potentially steal some of December’s thunder. As after a 5% or 10% rally in November, the returns in December are more muted. The flipside to this though is if the S&P 500 is up more than 10% for the year (like 2020), then stocks have benefited from some performance chasing and have tended to do better.

    [​IMG]

    What does it all mean? After the historic move in November we wouldn’t be surprised to see below average returns in December. We do believe this is a new bull market and lasting economic cycle of growth, but overall sentiment is getting quite stretched and this increases the potential for some near-term weakness. Please read COVID-19 May Threaten The Economic Recovey for more of our near-term thoughts.
     
  5. Stockaholic

    Stockaholic Content Manager

    Joined:
    Mar 29, 2016
    Messages:
    13,767
    Likes Received:
    7,050
    Here are the current major indices pullback/correction levels from ATHs as of week ending 12.4.20-
    [​IMG]

    Here is also the pullback/correction levels from current prices-
    [​IMG]

    Here are the current major indices rally levels from correction low as of week ending 12.4.20-
    [​IMG]
     
  6. Stockaholic

    Stockaholic Content Manager

    Joined:
    Mar 29, 2016
    Messages:
    13,767
    Likes Received:
    7,050
    [​IMG]

    Here are the upcoming IPO's for this week-

    [​IMG]
     
  7. Stockaholic

    Stockaholic Content Manager

    Joined:
    Mar 29, 2016
    Messages:
    13,767
    Likes Received:
    7,050
    Stock Market Analysis Video for December 4th, 2020
    Video from AlphaTrends


    ShadowTrader Video Weekly 12.6.20
    Video from ShadowTrader
     
  8. Stockaholic

    Stockaholic Content Manager

    Joined:
    Mar 29, 2016
    Messages:
    13,767
    Likes Received:
    7,050
    [​IMG]

    Here are the most anticipated Earnings Releases for this upcoming trading week ahead.

    ***Check mark next to the stock symbols denotes confirmed earnings release date & time***

    Monday 12.7.20 Before Market Open:
    [​IMG]

    Monday 12.7.20 After Market Close:
    [​IMG]

    Tuesday 12.8.20 Before Market Open:
    [​IMG]

    Tuesday 12.8.20 After Market Close:
    [​IMG]

    Wednesday 12.9.20 Before Market Open:
    [​IMG]

    Wednesday 12.9.20 After Market Close:
    [​IMG]

    Thursday 12.10.20 Before Market Open:
    [​IMG]

    Thursday 12.10.20 After Market Close:
    [​IMG]

    Friday 12.11.20 Before Market Open:
    [​IMG]

    Friday 12.11.20 After Market Close:
    NONE.
     
    T0rm3nted likes this.
  9. Stockaholic

    Stockaholic Content Manager

    Joined:
    Mar 29, 2016
    Messages:
    13,767
    Likes Received:
    7,050
    And finally here is the most anticipated earnings calendar for this upcoming trading week ahead-
    ($JKS $ADBE $CHWY $GME $COST $LULU $COUP $AZO $AVGO $RH $SFIX $HRB $CPB $TOL $SMAR $THO $CIEN $ALOT $ORCL $MDB $HQY $DLHC $UNFI $VRA $CMD $LOVE $CASY $VERU $GIII $GWRE $LQDT $ROAD $BF.B $DBI $PHR $PLAB $KLXE $RYB $AVAV $FLR $GEF)
    [​IMG]

    If you guys want to view the full earnings post please see this thread here-
     
    T0rm3nted likes this.
  10. Ken34

    Ken34 2017 Stock Picking Contest Winner

    Joined:
    Apr 4, 2016
    Messages:
    1,039
    Likes Received:
    723
    that news about marijuana did a great deal to a stock i currently hold called planet 13. lovely pop today.

    [​IMG] [​IMG]
     
    stock1234 and JaysonW like this.
  11. stock1234

    stock1234 2017 Stockaholics Contest Winner

    Joined:
    Apr 3, 2016
    Messages:
    5,584
    Likes Received:
    4,619
    Was looking to get into FATE last week but got into IOVA instead :mad: What a run by FATE today
     
    #11 stock1234, Dec 7, 2020
    Last edited: Dec 7, 2020
    B Russ likes this.
  12. B Russ

    B Russ Well-Known Member

    Joined:
    Sep 25, 2017
    Messages:
    556
    Likes Received:
    344
    What put fate on your radar and when? I just saw your post and yes. That was a hella run.
     
    stock1234 likes this.
  13. stock1234

    stock1234 2017 Stockaholics Contest Winner

    Joined:
    Apr 3, 2016
    Messages:
    5,584
    Likes Received:
    4,619
    Was just looking to put a little bit more money in some biotech stocks lately since XBI is red hot :p Since there are so many biotech stocks out there, I was just checking what ARKG is holding and tried to pick one or two to buy last Thursday. Picked IOVA instead of FATE eventually :p
     
    B Russ and anotherdevilsadvocate like this.
  14. stock1234

    stock1234 2017 Stockaholics Contest Winner

    Joined:
    Apr 3, 2016
    Messages:
    5,584
    Likes Received:
    4,619
    Thinking about to put some money on BCS for a lottery play just in case if we get a Brexit deal :p
     
    #14 stock1234, Dec 7, 2020
    Last edited: Dec 7, 2020
  15. anotherdevilsadvocate

    anotherdevilsadvocate Well-Known Member

    Joined:
    Apr 3, 2016
    Messages:
    4,319
    Likes Received:
    3,375
    HCCH is a shell company that is merging with "Fusion Fuel Green".
    finviz is showing only 460,000 shares floated and 20% of that is short. Only 2M shares outstanding even, today's volume over 500,000.
     
  16. stock1234

    stock1234 2017 Stockaholics Contest Winner

    Joined:
    Apr 3, 2016
    Messages:
    5,584
    Likes Received:
    4,619
    Yeah I have been playing a little bit of the SPAC companies lately too. Currently in LCA, IPOB and SBE :p
     
  17. stock1234

    stock1234 2017 Stockaholics Contest Winner

    Joined:
    Apr 3, 2016
    Messages:
    5,584
    Likes Received:
    4,619
  18. andyvds

    andyvds Active Member

    Joined:
    Jul 17, 2020
    Messages:
    212
    Likes Received:
    109
    Palantir +20% - nice.
     
    JaysonW likes this.
  19. stock1234

    stock1234 2017 Stockaholics Contest Winner

    Joined:
    Apr 3, 2016
    Messages:
    5,584
    Likes Received:
    4,619
    SFIX surging after earnings :eek: The stock has high short interest too and we could see some massive short covering tomorrow :eek:
     
    T0rm3nted likes this.
  20. T0rm3nted

    T0rm3nted Moderator
    Staff Member

    Joined:
    Apr 2, 2016
    Messages:
    8,448
    Likes Received:
    3,268

Share This Page