After a one-day pause, the DJIA and S&P 500 resumed their upward trek. Breadth was pretty good, with about four gainers for every three losers, but a stronger dollar hurt oil, precious metals and commodities.
One big difference this time is that the rotation has slowed and stocks are moving in tandem to a greater degree. Big-cap technology names such as Alphabet (GOOGL) and Amazon (AMZN) moved along with the DJIA. Semiconductors were one of the better performing groups and technology in general attracted attention. (Alphabet is part of TheStreet's Action Alerts PLUS portfolio. Amazon is part of the Growth Seeker portfolio.)
The bulk shipping sector suffered a brutal death after DryShips (DRYS) reopened for trading and plummeted 100 points from the highs it hit on Tuesday before it was halted. The whole sector collapsed and speculative traders were unable to find any new themes to keep them busy.
This is reminiscent of many of the other V-shaped moves that trap overzealous top callers who are convinced the market is extended and a correction is due. It also causes frustration for bulls who want to put more cash to work but are struggling to find entry points. Those dynamics have a tendency to hold the market up. Strong markets tend to stay sticky to the upside and we are seeing a good example.
At this juncture, it is much easier to look for reasons to sell the market rather than to buy, but true momentum players will stay with this action until there are some stronger warning signs. Yes, there is some froth out there, but the price action remains positive and there is still dip buying to prevent any major selling pressure
Have a good evening. I'll see you tomorrow.