Yellen & Co Do Nothing
0
July 30, 2014

7-30-2014 6-54-48 PM cool

It is remarkable after calling-out social media, biotech and small cap stocks they’ve rallied smartly once the initial selling was over. It reminds me of Greenspan’s “irrational exuberance” remark in 1996 that had a half-day effect on markets.

So today’s market response was rather odd all things considered. Investors fear higher interest rates period. Given today’s better GDP and ADP Employment Reports we might be changing the prior meme from “bad news is good, good news is better” to bad news is good, good news is bad”. In any event, markets wil have to adjust to higher interest rates eventually.

We have limited time for writing today but I would add the McClellan Summation Index (near conclusion) has shown markets in correction mode for some time now.

Leading market sectors higher included: Financials (XLF), Banks (KBE), Regional Banks (KRE), Transports (IYT), Small Caps (IWM), Biotech (IBB), Social Media (SOCL), Healthcare (XLV), Retail (XRT), Consumer :Discretionary (XLP), Semiconductor (SMH), South Korea (EWY),Russia (RSX) and India (EPI)

Leading market sectors lower included: Utilities (XLU), Consumer Staples (XLP), China (FXI), Brazil (EWZ), Mexico (EWW), Turkey (TUR), Indonesia (IDX), Crude Oil (USO), Solar (TAN), Natural Gas (UNG) and Bonds (TLT)

The top 20 market movers by percentage change in volume whether rising or falling is available daily.

Volume increased substantially particularly after the Fed’s announcement. Breadth per the WSJ was mixed to negative.

7-30-2014 6-56-47 PM diary

Charts of the Day
  • SPY 5 MINUTE

    SPY 5 MINUTE

  • SPX WEEKLY

    SPX WEEKLY

  • INDU WEEKLY

    INDU WEEKLY

  • RUT WEEKLY

    RUT WEEKLY

  • NDX WEEKLY

    NDX WEEKLY

  • NYMO DAILY

    NYMO  DAILY

    The NYMO is a market breadth indicator that is based on the difference between the number of advancing and declining issues on the NYSE. When readings are +60/-60 markets are extended short-term.

  • NYSI DAILY

    NYSI DAILY

    The McClellan Summation Index is a long-term version of the McClellan Oscillator. It is a market breadth indicator, and interpretation is similar to that of the McClellan Oscillator, except that it is more suited to major trends. I believe readings of +1000/-1000 reveal markets as much extended.

  • VIX WEEKLY

    VIX WEEKLY

    The VIX is a widely used measure of market risk and is often referred to as the "investor fear gauge". Our own interpretation is highlighted in the chart above. The VIX measures the level of put option activity over a 30-day period. Greater buying of put options (protection) causes the index to rise.


     

Closing Summary

Away from a few high fliers like Facebook and Twitter earnings overall have been uninspiring.

Thursday will feature Jobless Claims, Employment Cost Index and Chicago PMI.

We’ll be on the road most of the day and will post late.

Let’s see what happens.

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Dave Fry is founder and publisher of ETF Digest and has been covering U.S. and global ETFs since 2001.

He is the author of "Create Your own ETF Hedge Fund: A Do-It-Yourself Strategy for Private Wealth Management" published by Wiley Finance and "The Best ETFs: U.S. Equities, A Companion Guide to Building Your ETF Portfolio".



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Disclaimer: The charts and comments are only the author's view of market activity and aren't recommendations to buy or sell only any security. Market sectors and related ETF's are selected based on his opinion as to their importance in providing the viewer a comprehensive summary of market conditions for the featured period. Chart annotation's aren't predictive of any future market action rather they only demonstrate the author's opinion as to a range of possibilities going forward. More detailed information, including actionable alerts, are available to subscribers at www.etfdigest.com

 

ETF Digest

Market Summary
NYSE Composite Index S&P 500 Index Nasdaq Composite Index Russell 2000 Small Cap Index NYSE Composite Index S&P 500 Index Nasdaq Composite Index Russell 2000 Small Cap Index 10 Year Treasury Note Yield Gold Bugs Index Morgan Stanley High Tech 35 Index Market Chart
Commodity Quote Change Change % NY
Gold1,296.701.200.09 % 05:15
WTI Crude Futr99.17-1.10-1.10 %04:39
Index Quotes Change Change % Local
CRB296.11-0.53-0.18 %17:27
US Dollar81.50-0.01-0.01 %16:59
Index Quotes Change Change % Local
VIX13.330.050.38 % 07/30
MSCI Value Daily MTD YTD
Brazil2497.900-1.35 %4.50 % 12.61 %
Russia664.5111.01 %-10.12 %-15.55 %
India503.3580.52 %2.18 % 23.58 %
China65.992-0.13 %7.32 % 4.58 %