WEEKEND NOTES

Still, nothing in the way of even a 3% correction. Major indices, for the most part, remain in good shape.

The DOW and S&P”s breakout from early last week remains intact.

The NASDAQ and NDX remain in shape but we are now seeing some mega-cap names causing a little bit of lagging here. Names like AAPL, AMZN, PCLN and GOOGL have worked against but not so much just yet. The NASDAQ needs to break above 6477, the NDX needs to hold the 50 day at 5911.

But past lagging areas continue to catch up. The TRANSPORTS have come up the right side in a hurry on the back of FDX, RAILS, TRUCKERS. Many say this is hurricane-related. We don’t care why.

On top of that, the small caps (RUSSELL 2000) are almost at new highs. Leave no doubt that the stronger action in the ENERGY has helped out a lot.

Other notes:

ENERGY is indeed stronger but very mixed. While a few names are at highs, a lot of names are still near lows. Stronger names COG,CVX, HFC,PSX,RDSA, SU, TOT.

SEMIS remain in shape. They continue to lead up or down.

The big FINANCIALS got a bid last week as long rates backed up. C remains the strongest names with others just back in range. The REGIONALS not so much but better.

The INDUSTRIALS (XLI) continue to move out with many cyclical and deep cyclical names breaking out in groups like CHEMICALS, PLASTICS, PAPER, WOOD PRODUCTS and stuff like that.

With rates backing up a wee bit, UTILITIES and CONSUMER STAPLES have been rolling over. These are the most defensive of areas.

We continue to be asked about how markets here refuse to correct in a meaningful fashion. To be boring and to repeat…markets are the benefactor of the most easy money largesse in the history of the world. Simple as that. Europe and Japan are still printing trillions and have negative rates. Many other countries are the same or near 0%. We really don’t matter any more but in case you wanted to know…we are still around 1%.  This is still out of bounds easy money. We also know you are hearing Yellen will start rolling back some of the $4.5 trillion of printed money here. Maybe they start, but they are starting nominally. They will never be able to roll it all back as Yellen has already telegraphed that if markets get into trouble, she can just start printing again. Yes…SHE SAID THAT!

 

PRE MARKET- AND BIOTECH BLOW UP

Quiet! But again, market refuses to budge. Any weakness is sopped up. EASY MONEY RULES! Yellen stating she will roll back QE is laughable. Already said she would reprint if markets fall. Really?

VSAR…as this is written, the stock is trading at $3…down $18.60. That is not a typo. Another BIOTECH with no sales with a ridiculous market cap that is trying to develop drugs that in trials, the —-did not work. Just a reminder…pick your poison. Know what you are getting into. Know risk. Measure risk. Of course, there have been plenty of “no sales” biotechs do well. In fact, we have seen a few of these names bought out. We are just giving you a head’s up!

 

Been one hell of a week. Would like to complain about not having power for 9 days but had a tiptoe through the tulips compared to many others. Full report over the weekend.

PRE MARKET

Very quiet early.

GOLD/SILVER continue the yonking as DOLLAR strengthens off of Yellen blah blah blah.

TRANSPORTS really coming on as RAILS/TRUCKERS and other stuff on the move.

Industrial-types also on the move…some say because hurricane…some say just because.

More later!

THE CLOSE

New stuff hitting the screen.

The lagging TRANSPORTS maybe no longer lagging. Truckers, rails breaking out.

INDUSTRIAL-types…packaging, equipment, chemicals, machinery, construction and all that stuff. Many saying the reason being is the rebuilding after the hurricanes. We dont care why!

OILS continue with the better bid as oil prices continue higher. Actually seeing a few names into new yearly high ground. Keep in mind, most are closer to yearly lows.

On the other end…continued weakness in GOLD over past few…also includes SILVER.

UTILITIES break the 50 day.

CONSUMER STAPLES also not so good.

And RETAIL continues to be gross, with few exceptions. Latest disaster is BBBY.

As far as the Fed…blah blah blah blah blah.

PRE MARKET

All quiet this morning.

Prayers to Puerto Rico. Been there about a dozen times. Cannot imagine what 150 mph winds will do. Prayers also out to those affected by earthquake in Mexico. 7.1 is a biggie.

Toys R Us bankruptcy… Bad service, bad pricing, bad website combined with massive debt…will do the trick. This was a must as suppliers would not have supplied. 40% of business is at holiday time. Expect fewer stores. Expect combining Babys R Us into one store.

Trump speech!…I just love when pundits who worked in the Obama, Bush and Clinton administration criticize Trump for his rhetoric when we are here because of Obama, Bush and Clinton. Horrible deal by Clinton and nothing done by Bush and Obama. The past 3 presidents are at fault for letting North Korea obtain their arsenal…which has now fallen into Trump’s lap…not to mention the Iran giveaway. I do not call it the Iran deal because a deal means both sides got something. Hopefully, the Trump administration gets things right on this. Keeping fingers crossed.

FDX small gap to downside, BBBY big gap…wow…used to be a big leader, ADBE, WDC, GIS also gapping down.