Weekend update - US equity indexes

It was a very mixed week for US equity indexes, with net weekly changes ranging from +2.01% (Trans), +1.57% (Dow), +1.06% (nyse comp'), +0.61% (sp'500), -1.03% (nasdaq comp'), to -1.97% (R2K). Near term outlook offers cooling of around 1-2%, before resuming upward.

Lets take our regular look at six of the main US indexes

sp'500

Despite ending the week on a rather bearish note, the sp' managed a fourth consecutive net weekly gain, +0.61% at 2818. The intra week high of 2848 was a mere 24pts shy of the Jan' historic high.

Best guess: s/t cooling to the 2760s, before resuming upward. New historic highs look on track in August. Big target remains the 2950/3047 zone, which is where I anticipate the market becoming seriously stuck.
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Nasdaq comp'

It was a very mixed week for the Nasdaq comp', breaking a new historic high of 7933, but swinging lower into the weekend, settling -1.06% at 7737. S/t bearish with the main market. The 8000s still look due in August.


Dow

The mighty Dow climbed for a fourth consecutive week, +1.57% to 25451, with a new multi-month high of 25587. S/t bearish with the main market. Note underlying macd (blue bar histogram) cycle has turned positive.


NYSE comp'

The master index gained 1.03% to 12921. S/t bearish, but new historic highs look viable in early September.


R2K

The R2K unraveled into the weekend, settling -1.97% to 1663. S/t bearish, with a viable test of the 1610 price threshold. Alarm bells with any closes <1600, but that does not seem likely.


Trans

The 'old leader' saw a very significant net weekly gain of 2.01% to 10957. Price momentum is set to turn positive within 1-2 weeks.
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Summary

Four indexes saw net weekly gains, whilst two settled sig' lower.

The Nasdaq comp' broke a new historic high.

The broader m/t trend remains unquestionably bullish.

YTD performance:

The Nasdaq continues to lead, +12.1%, with the sp +5.4%, and the nyse comp' being the laggard, +0.9%.
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Looking ahead 

Another truck load of earnings are due, notably: CAT, STX, AAPL, TSLA, X, SQ, PBR

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M - Pending home sales
T - Pers' income/outlays, employment costs, Case-Shiller HPI, Chicago PMI, consumer con'
W - Vehicle sales, ADP jobs, PMI/ISM manu', construction, EIA Pet' report.

At 2pm the Fed' will issue a press release of the latest FOMC. No rate hike can be expected, but the statement should give an update that the QT program is at/close to hitting $50bn a month. There will NOT be a press conf'.

T - Weekly jobs, factory orders
F - Monthly jobs, intl' trade, PMI/ISM serv'
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Have a good weekend
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*the next post on this page will likely appear 5pm EST on Monday.

The infamous Kudlow

US equity indexes closed broadly weak, sp -18pts (0.6%) at 2818. The two leaders - Trans/R2K, settled -0.2% and -1.9% respectively. VIX settled +7.3% at 13.03. Near term outlook offers sp'2768, before resuming broadly upward.


sp'daily5

VIX'daily3

Summary

US equities opened in minor chop mode, and price action was a little shaky. With a break of the s/t rising trend, prices spiraled lower, with an afternoon low of 2808. There was a moderate late day choppy bounce to settle at 2818.

Volatility picked up, with the VIX seeing the 14s, but settling in the low 13s. S/t outlook offers minimum technical necessity of sp'2768, which should now equate to VIX 15/16s.
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The infamous Kudlow

In early morning, Trump decided to hold a little meeting with the media hacks...

Trump proudly touted the first print of Q2 GDP that came in at 4.1%. Things got far more interesting with ex-CNBC 'contributor', Larry Kudlow - Director of the President's National Economic Council.

The following will no doubt be widely referenced in the years ahead....

"This is a boom that will be sustainable. Frankly, as far as the eye can see. This is no one shot, ever" - Kudlow, L. July 27th 2018.


Financial historians will look back on this as just another classic delusion by central government that believes it can negate the natural economic cycle. Kudlow is widely recognised as touting 'no recession' as late as summer 2008. He was economically wrong then... and the notion the current boom is sustainable, is utter nonsense.

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Goodnight from London
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Mixed Thursday

US equity indexes closed moderately mixed, sp -8pts (0.3%) at 2837. Nasdaq comp' -1.0% at 7852. The two leaders - Trans/R2K, settled +0.8% and +0.6% respectively. VIX settled -1.2% at 12.14. Near term outlook offers chop into the weekend.


sp'daily5

VIX'daily3

Summary

It was a mixed Thursday, with sig' weakness in the Nasdaq, but moderate strength in the Dow and R2K. Volatility remained very subdued, melting lower for a fifth consecutive day, settling in the low 12s. S/t outlook offers chop into the weekend, but minimum technical necessity of sp'2768 remains due, and that will likely equate to VIX 14/15s.
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Bonus chart: Germany, monthly

With just three trading days left of the month, the DAX is currently +4.1% at 12809. A July settlement back above the key 10MA would give some extra confidence for Aug/Sept.

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Goodnight from London
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