Stocks ended the day with slightly negative breadth of about 3,700 gainers to 4,300 decliners, but there was some interesting rotational action taking place.
The primary winners were bigger-cap, growth names. A couple of good examples are TaskUs (TASK) and the Beauty Health Company (SKIN) . The IBD 50 exchange-traded fund (FFTY) gained 2.2%, and the Nasdaq 100 ETF (QQQ) gained 1%, due mainly to the FATMAAN names.
On the other hand, the Dow Jones and Russell 2000 ETF (IWM) both finished with small losses. Some of the small, thin caps traded very poorly, and certain sectors like biotechnology and cannabis struggled. Pockets of speculative momentum were rather narrow, but strength in bitcoin and some of the miners provided traders with action.
It has been the tendency of the market to go through rotational corrections as it becomes extended. For months this summer, we had very deep corrective action in parts of the market, but you would never know it by looking at the indexes. The action was a little like that, but it was pretty healthy overall, given how well things bounced last week.
Earnings heat up tomorrow, so we should continue to see more focus on stock picking. There is some mixed action out there, but there is support and speculative interest, and that is the key.
Have a good evening. I'll see you tomorrow.