The US Indexes finally pause for breath but Blockchain and risk assets continue to run

For the first time since the US Election rally, the US Indexes were all down yesterday. The VIX was flat at 15. The main indexes were; DJIA -0.86%, S&P 500 -0.29% and Nasdaq -0.09% (Mag7 -0.12%). On an equal weighted basis (our measure) the overall market was -0.98%. Breadth of 27% (range of 12% to 88% over the last six weeks) highlighted that there were clear winners and losers from the Election result. Volumes were strong at 10b (the average daily volume over the last year of 8b). 

One day returns as follows - equal weight basis: Mag7 -0.12% (NVDA +2.1%, MSFT +1.2%, AMZN +1%, TSLA -6.2%), large cap -0.84%, medium cap, -1.28%, small cap -1.65% and micro cap -0.53%.

On a 1 and 2 week equal weight basis respectively; Market +3.5% and +3.4%, Mag7 +7.7% and +5.8%, Large caps +2.5% and +2.8%, Medium cap +3.8% and +4.4%, Small cap +4.3% and +5.2% and finally Micro cap +3.2% and +2.2%. 

Our risk monitor remains in favour of the larger cap stock but Small cap in particular has been very strong over the last 1w and 2w and outside of Mag7 they are the best performer. Micro caps have underperformed the market by 1.2% over the two weeks.

Academic & Educational was the only sector in positive territory yesterday. In recent times this has been due to the distortion of Chinese stocks but yesterday it appeared to be the remote technology companies that performed best, perhaps on the back of Trumps desire to shake up the Education sector. Food & Beverages, the stalwart defensive sub sector within Consumer Non-Cyclicals, supported the wider sector. Technology was strong (relative) again yesterday and remains the strongest sector since the Election results. Fintech was very strong again at +5.7% (Blockchain +10.8% as Bitcoin hits record highs. The sub sector is now +56% since the Election). Industrials beat the market again yesterday albeit it was down on the day. Aerospace +0.54% led the way. Strength in Investment Banking helped Financial beat the market yesterday. Finally Energy was the only other sector to beat the market, Uranium was +0.72% and the Renewable Energy also outperformed, though they are still -11.2% since the election. Healthcare and Consumer Cyclicals continued to lag the market (slightly) since the election which is a surprise considering they are both traditional beneficiaries of a more bullish market.

A notable number of 52 week highs was seen in all sectors: Exceptionally high number of 52 week highs in Consumer Cyclicals (Hotels & Entertaining and Media & Publishing), Financials particularly Banking & Investment Services. Industrials was strong again (across the sector including Transportation... for the second time) and Technology (Software & IT Services, Technology Equipment and FinTech).

Notable high volumes in all sector: Exceptional levels in Consumer Cyclicals (across the sector), Financials (across the sector), Industrials (across the sector) and Technology (Software & IT Services, FinTech and Technology Equipment)