The S&P 500 and Nasdaq finished the week by hitting new highs for 2019. The strength was primarily caused by good earnings from JPMorgan Chase (JPM) and a multi-year breakout by Disney (DIS) following announcement of a new streaming service. Some good economic news out of China helped out the bullish cause as well.
The indices have been trending up since April 1 when there was a gap-up open on some different positive economic news from China. That news undercut worries about an inverted yield curve and slowing economic growth. As I discussed in my opening post Friday morning, we now have a Goldilocks' environment with good growth, low inflation, record-low unemployment and accommodative central bankers. There just isn't a compelling negative narrative to worry market players.
While it was a positive week, there were some peculiarities. Volume has been running light and the trading was very dull and lackluster at times. There hasn't been much aggressive trading but a few bigger-cap names have performed well and made the indices look quite healthy. Banks and financials ( (XLF) ) did well for the week but more speculative groups like biotechnology and cannabis have struggled.
The trend of the indices is quite positive but the underlying action has been mixed on lighter volume, which makes things more challenging for traders. While this is partially a function of caution in front of earnings season, JPM was a good start for reporting season that picks up next week but really doesn't gain steam until the week after.
There are plenty of bears scoffing at this market uptrend. However, talk is not only cheap, it will cost you money if you are trying to fight this market action.
Have a great weekend. I'll see you on Monday.