S&P 500 stopped consolidating before the opening bell already, and buyers didn‘t let their guard down throughout the session. Not that the preceding earnings were smashing the NVDA way, but they were still good – you know already how much I had been in past weeks praising Q4 earnings as delivering positive surprises, and clients heard me plenty talking XLC (NFLX, META), XLF and XLI with of course XLK (NVDA, SMCI, ARM, MSFT) throughout already November and December – just check where all of these are now…

As an extra hint, defensives (XLU, XLP) keep acting weak while many consumer stocks (XLY and AMZN, which also belongs to the above bullish mix – talked mid Oct and early Nov) do well – these are hardly the circumstances favoring pronounced weakness. Except that there is still more yields pressure with USD up, and not complete acknowledgement of no rate cut Mar – yields aren‘t still done rising in the very near term.

As written yesterday:

(…) with PMIs improving, and I‘m looking at manufacturing that I have been in latest weeks covering in a bullish manner (it‘s turning up, and that leaves little room for significant pressure on stock prices).

There are though pockets of weakness too, chiefly sectors and subsectors that have had to adjust to really no rate cut Mar (21% odds now only) – it must be getting bad when Yellen‘s attention is turning to regional banks and commercial real estate too.

When have you heard me talking Russell 2000 bullishly last? In a proper manner, before the end of the year, and then when it comes to prognostications for more solid 2024 year end – too many zombie companies out there depending on cheap financing, and with BTFP leaving stage right soon…

This is the time of selective S&P 500 market, with the frequently raised question of larger correction getting my answer of a sideways move a la second half of Nov 2023 being more probable.

Gold, Silver and Miners

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Gold prices looks likely to revisit low $2,020s approximately again. Note the low volume on the latest upswing that doesn‘t favor the buyers.

Crude Oil

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Crude oil proved it was a very cautious hold rather than buy, yet is acting in a more decisive way today – and that favors the slow grind higher to continue.

Copper

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Copper with base metals is slowly reaching an interesting undervaluation point within the commodities complex, but didn‘t yet find the bottom. The longer it keeps above $3.70, the better for the red metal – its better days are likely to come only next week.

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