There was some slight panic in the small-cap momentum stocks, but it only lasted for a few minutes. Stocks spent the rest of the day recovering and even ended up creating some "fear of missing out" with a strong finish.
Breadth went from two-to-one negative early in the day to 4,300 gainers to 3,200 decliners at the close. The number of stocks hitting new 12-month highs contracted to around 300 from over 800, but that was due primarily to rotation out of the big recent winners and into some less extended names.
Overall the underlying support was quite good and that is exactly what is needed to keep a trend going. One thing that is helping is some optimism about a fiscal stimulus deal next week. Although Covid cases continue to grow, the focus is on the vaccines. There is no major concern that there is going to be substantial economic slowing before the vaccines are distributed.
The old saying "the trend is your friend" is operational. There is some rotational action and the trading is a bit sloppy and choppy, but the small-cap stock picking is still exceptional and that is the biggest positive of all.
Have a good evening. I'll see you tomorrow.