The Mag7 led the US Indexes higher on Wednesday with risk stocks - blockchain, space, tech hardware and biotech - leading the Micro cap

Better than expected inflation data offset last weeks strong December non-farm payroll yesterday ands this helped push the market higher. 10 yr bond yields have fallen back, having bounced post the non-farm release. The rising / high bond yields remains a concern as so much US debt is being refinanced this year (US$9 trillion), higher financing costs is likely to impact equities so keep an eye on the 10yr yield.

The US Indexes were strongly ahead on Wednesday with the Mag7 pushing the Nasdaq and S&P higher. The VIX was down 3 at 16. The main indexes were; DJIA +1.65%, S&P 500 +1.83% and Nasdaq +2.45% (Mag7 +3.64%). On an equal weighted basis (our measure) the overall market was +1.75%. Breadth of 76% (daily range since the election is 9% to 71%). Daily volumes of 10b (the range since the election is 8b to 18b). 

Daily returns on an equal weight basis: Market +1.75%, Mag7 +3.64% (TSLA +8%, META +3.9%, NVDA +3.4%, GOOGL +3.1%, AMZN +2.6%, MSFT +2.6%, AAPL +2%), large cap +1.3%, medium cap +1.2%, small cap +2% and micro cap +1.9%. 

Weekly returns on an equal weight basis: Market flat, Mag7 +0.9% (TSLA +8.4%, META +1.1%, GOOGL +0.8%, AMZN +0.6%, MSFT +0.4%, AAPL -2%, NVDA -2.8%), large cap +0.9%, medium cap +1.5%, small cap +1% and micro cap -1.1%.

Ten days ago our risk monitor tipped in favour of the Micro cap stock for the first time in over 12 months but this started to reverse last week.

Technology +2.9%, Healthcare +1.8% and Industrials +1.8% led the market recovery yesterday following better than expected inflation data. Blockchain +6.4% , Phones & Handheld +4.7%, Computer Hardware +4.3% and Semicon +3.4% led the Tech sector higher. Biotech +1.9% was the best performer in the Healthcare sector and Aerospace +2.4% and Construction & Engineering +3.4% pushed the Industrial stocks higher. Financials +1.6% slightly underperformed the market with Banking +2.2%. Energy continued to perform well with Uranium trading well +2.2% although Renewal Equipment was -0.5%. Basic Materials +1.4% lagged the market, Forest & Wood Products +3.8% and within Metals & Mining both Aluminum +3.1% and Iron & Steel +1.9% both outperformed the market again, Gold +0.2% lagged behind. Utilities +1.4% generally lagged albeit Electric & IPPs +1.7% was the best performer - these stocks, particularly the nuclear stocks, are linked to AI cycle. Consumer Cyclicals +1.4% were pulled higher by Auto & Truck +2.8% - specifically the EV companies. Real Estate +1.1% was pulled up by Real Estate Operations +4.8%. Consumer non-cyclical was the only sector to fall yesterday -0.1%, pulled lower by Food & Drug -0.5% and Food & Beverage -0.3%.

A notable number of 52 week highs was seen in the following sectors: Energy (fossil fuels), Industrials (Aerospace & Defence) and Technology (Software & Services, Technology Equipment)

High volumes were seen in the following sector: Healthcare (across the sector), Industrials (across the sector) and Technology saw a very high number (Software & IT Services, Technology Equipment)