We know the DOW was down almost 300 points yesterday but nothing changed. If you noticed, the NASDAQ/NDX almost came all the way back off of the same select few megacap names. That’s for starters.
Emerging and other markets continue to underperform and badly…go look at EEM, EFA, FXI, TUR, RSX, EWZ, IEMG just for starters. The only good thing we can say is that the selling is way overdone and suspect a bounce is due. Just leave no doubt how weak they are.
The DOW remains the weakest of the major indices. BA not helping any more. This was a staunch leader for a long time. The trade issue does not help.
Big FINANCIALS remain comatose but notice important BAC and JPM holding longer-term 200 day average.
INDUSTRIALS (XLI) is now rolling over.
STEEL (SLX) and METALS/MINING (XME) have rolled over on a near-term basis.
UTILITIES (XLU) remain gross but notice not going lower.
TRANSPORTS may have hit a wall but RAILS and TRUCKERS still act well. FDX will be down a few this morning.
OILS have weakened but seems like somewhere in here, support is showing up. A bunch of oil names remain in shape but leave no doubt, many names have broken down.
BIG BIOTECH blah but a little better.
SEMI-EQUIPMENT dead look oversold.
DEFENSE stocks dead.
CHEMICALS and MACHINERY in poor shape.
There are other areas in poor shape. We do believe they are all oversold and could bounce but remain amazed how many weak areas, some very weak areas there still are.
What still works? TECH/INTERNET/CLOUD/SOFTWARE…especially a few megacaps that influence the indices. Also RESTAURANTS, a bunch of RETAIL/APPAREL, MANAGED CARE, RAILS, TRUCKERS. Lastly, a bunch of speculative, money losing IPOs have been strong but are now in pullback mode…
In other words…quite the split tape!