INDEX UPDATE
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RUT - setting new high again
BKX(BANKING)- approaching its highs
XAL(AIRLINES)- still near its highs
XBD(BROKER) - near the highs
XOI(OILS) - near the highs again
DRGS(DRUGS) - one of the leaders today on a percentage basis
NASDAQ COMP - nearing its highs again
TYX(INTEREST RATES) - very strong day for the stock markt
Most, including myself, would feel that the DOW would have been up much higher than it is in light of the good economic news.
From the data, the other indexes are moving up nicely, which the DOW is still moving up but lagging. My analysis of this is that whenever the DOW pops up, people are taking the opportunity to sell the DOW stocks and move to other areas in the stock market.
Although the money moving into the market has decreased compared to earlier months, the in-flow is still increasing, but at a lower pace. The key is that money is not moving out of the overall stock market, but is rotating.
As I have indicated in earlier posts - The DOW will always be important, but the DOW may not always be the best indicator of how the overall market is doing. The DOW is not the overall market - it is only 30 stocks. Two of the largest market cap companies (MSFT & INTC) are not in the DOW.
We now have major money rotataion which we have not seen for a while, so please do not let the lagging DOW fool you that the overall market is dropping for the short/mid-term(30 days).
It is possible for the overall market to have a bigger correction, but right now the short-term trend is definitely on the upside. |
