- The recovery trade was reflected in the major averages again, with the Dow (DJI) +1.1% leading, followed by the S&P (SP500) +0.6% and the Nasdaq (COMP) +0.2%.
- The Russell 2000 (RTY) +2% also outperformed.
- The Fab 5 megacaps weighed on the Nasdaq, all closing down. Apple -2.9% was the biggest decliner.
- Apple's drop also pressured the S&P as well, but after its stock split doesn't have as much impact on the Dow, which was boosted by Goldman Sachs and Boeing, a big rotation winner now up 45% in November.
- Dow "fluctuations are largely a function of price movements in just ten equities," Paul Franke writes on Seeking Alpha. "Because of the underlying index design, 33% of the largest 30 companies in America, control an overwhelming 53% of the index value computations daily."
- Energy (NYSEARCA:XLE) +7% topped the sectors list and is now up about 33% this month. Crude futures +1.3% are just above $43/barrel.
- “A decisive break and hold above $43.30 could put the pre-COVID-19 selloff of $49/bbl into play,” HFI Research writes on Seeking Alpha today. “Considering the fundamental picture for oil continues to improve especially with global oil inventories still accelerating downward despite renewed lockdowns, it does look like oil is on the cusp of breaking out.”
- Nine out of the top 10 S&P performers were energy names, with Occidental Petroleum +17% the biggest gainer.
- Gold futures -1.8% fell to prices not seen in fourth months. Newmont -5% was the worst performer in the S&P.
- Nine of 11 S&P sectors finished higher, with the defensive stocks on the back foot again. Real Estate (NYSEARCA:XLRE) and Healthcare (NYSEARCA:XLV) ended in the red.
- The strength in post-pandemic stocks was on full display in Consumer Discretionary (NYSEARCA:XLY). Department stores rallied again, with Nordstrom +10% adding to its recent stellar gains. Apparel makers like Ralph Lauren +6.6% and cruise lines were also strong. In Industrials (NYSEARCA:XLK) airlines were strong.
- Interest rates also gained some traction after last week's sharp decline. The 10-year Treasury yield is up to 0.86%.
