Some of the rotational action that occurred on Friday is reversing this morning as the DJIA leads with a gain of about 1% and growth stock ETF, ARK Innovation (ARKK) is back in negative territory. Oils have bounced back, but cryptos are being pounded, and the small-cap speculative names that held up Friday are struggling to keep the momentum going this morning.
Breadth is around 3-2 positive, but there are only about 55 new 12-month highs which tells us that there isn't any clear leadership right now. Market players are jumping around quickly and are taking profits into strength.
I don't want to sound negative as it is a major positive that there isn't aggressive downside follow through this morning. Many pundits were ready to declare that higher rates and inflation worries were the death knell for this market, but that doesn't appear to be the case right now.
I'm working on some stock picking, but it is a tough slog, and it is necessary to be very selective. My Stock of the Week is TaskUs (TASK) , and that is off to a fine start this morning. I think TASK may be a long-term winner, and it will stay on my radar as it heads into initial analyst coverage and its first earnings report as a public company.
A few other names I've added this morning are Butterfly Network (BFLY) and Aurinia Pharmaceuticals (AUPH) . EMCORE Corp (EMKR) is also on my radar as a Russell index addition, but those plays can have some strange volatility into the rebalancing.
The overall tone of the market is good, but my impression is that market players lack energy.