October's Q4 guidance is key

With the Market now expecting imminent interest rate cuts, the focus returns to news: August nonfarm payroll is released next Friday and the Fed interest rate decision is 18 September. Market volumes have been generally soft over the last month but as the traders return to the Market, post Labor day, the direction the market should become evident, particularly as we start to see Q3 results and Q4 guidance in October.

We seem to be in a period similar to that seen in the mid to late 90s with continued fears of overheating and inflation concerns resulting in market retreats followed by periods of strong market performance. Our market history page shows the volatility by sector during this time. During the period '95 to 2000 a time of remarkable underlying growth the market retreated 8 times for typically 2 or 3 consecutive months. Is the economic environment today more or less uncertain in comparison?

Looking at the Markets yesterday, whilst there was a fairly broad advance (62%) on decent volumes for the month (7.7b), the sectors performance lacked any clear direction albeit all sectors advanced ex Real Estate. Best performing sectors included Basic Materials (Construction Materials, Speciality Mining, Iron & Steel and Gold), Technology (Fintech and Software & IT Services) Industrials (Machinery Tools & Heavy Vehicles and Aerospace).

A notable number of 52 week highs in virtually all sectors ex Academic, Energy and Utilities.

Notable high volume: Consumer Cyclicals (Retailers and Consumer Products and Services), Financials (Banking & Investment Services), Industrials (Machinery, Tools, Heavy Vehicles and Professional & Commercial Services).

Trending Industries on a 2 week basis: Hotels, Motels, Cruise (SOND, LIND, GHG, NCLH, ATAT), Household Goods (RR, COOK, FEBO, WHR), Personal Products (DSY, SKIN), Coal (HNRG, ARCH, CEIX), Banking Services (BYFC, ASRV, CZFS, FDBC, SFBC, FVBC, FFWM), Property and Casualty Insurance (RDZN, HRTG, HGTY, LMND, NODK, ACGL), Biotech (VRAX, NCNA, CMMB, SLGL, LUMO, RVPH, GOVX, TCBP, ALRN, ABIO, VINC), Courier, Postal, Air Freight (SGLY, FWRD, QH), Commercial Printing (CMPR, ARC), Computers, Phones, Household Electronics (VOXX, RAY, KOSS, SONY, SGE), Integrated Hardware Software (TLS, SPPL, HKIT, CLMB)