The market theme for a while now has been positive action in the indices but choppy action in individual stocks. There hasn't been much consistency from day-to-day but the indices keep chugging along.
Last Thursday it was high-growth and FAANG-type names -- Facebook (FB) , Amazon (AMZN) , Apple (AAPL) , Netflix (NFLX) and Alphabet (GOOGL) -- that drove the action. On Friday strength rotated back into value-type groups like consumer cyclicals. Today it was back to the growth names with the FAANGs, once again, performing well.
Small-caps led today and that was reflected in breadth of around 4250 gainers to 2750 decliners. Despite the strength we still had around 160 stocks hitting new 12-month lows which illustrates the bifurcated nature of the market.
One good sign today was that there were some better pockets of momentum. For example, I mentioned Intelsat (I) this morning, and names like Square (SQ) and Paycom Software (PAYC) attracted interest again after quick pullbacks.
I suspect we have some 'don't short a dull market' action that helped as the bears keep thinking that a combination of the summer doldrums, trade war worries and higher interest rates will pull the rug out from under the market.
The negative narrative just isn't gaining any traction, so the better approach is to focus on stock picking on the long side. It is not an easy trading environment due to the choppiness but there is some action if you do some digging.
One stock that will be particularly interesting on earning tonight is Turtle Beach (HEAR) . I've mentioned it many times and it has been one of Stocks of the Week. It has run up big but posted blow-out numbers and guidance. I expect it to be wildly volatile and will be looking for some entries.
Have a good evening. I'll see you tomorrow.
