The weekly market reports include a stock market forecast and an analysis of capital markets. Access to the full report requires a Premium Articles, Weekly Premium Articles, or All-in-One subscription.
Included in this weekly market report:
- “There can be only one.”
- Revisiting the tech to S&P 500 ratio.
- The yield curve will stay inverted for longer.
- Highly overbought stocks in the Russell 1000.
Weekly Summary (March 25–March 28, 2024)
- The utilities and energy sectors led to a rise in large-cap stocks.
- Bond prices gained and yields fell, but uncertainty remains high.
- Precious metals and energy led the rally in commodities.
- The US dollar was up slightly, despite expectations of lower rates.
The spot price of crude oil jumped 3.5% this week to $84 per barrel. Year-to-date, spot crude oil is up 16.8%. Due to a broad commodities rally, which saw gains in energy and precious metals, the DBC ETF increased by 1.1%. Gold (GLD) was up 2.7% despite a resilient U.S. dollar index (UUP), which gained 0.2% for the week. Gold (GLD) has outperformed the SPY ETF by a wide margin since 2022, 20.3% versus 14%, respectively.
Large-cap stocks (SPY) rose 0.4% in the holiday-shortened week, with utilities and energy rising 2.8% and 2.2%, respectively. Tech stocks (QQQ) fell 0.5% due to profit-taking. Small caps (IWM) added 2.6% but are down 10.2% from their all-time highs.
High beta large caps (SPHB) gained 2% due to expectations of rate cuts this year, while low-volatility large caps (SPLV) gained 1.4%. The Dow Jones Industrial Average (DIA) ended the week up 0.8%. The magnificent 7 equal-weight index fell 1.5% for the week, with NVDA down 4.2% and META falling 4.7%.
The TLT ETF gained 0.7% for the week. Since January 3, 2022, the TLT ETF has been down 31.9%, while large-caps (SPY) have gained 14%.
“There can be only one.”
“There Can Be Only One” is a phrase that originates from the popular Highlander franchise, which includes movies, TV series, and other media. The phrase “There Can Be Only One” encapsulates the idea that, in the end, only one immortal can survive. It’s a mantra that underscores the fierce competition and struggle for supremacy among the immortals in the Highlander universe. Throughout the series, this concept drives much of the conflict and drama as immortals duel each other in pursuit of the “Prize”, which is the ultimate reward for being the last one standing. Source: ChatGPT, edited.
I believe I have a good idea of how “There Can Be Only One” relates to the financial markets, and this is now more relevant than ever: there are two immortals and a struggle for ultimate power. But first, we need to take a look at this chart.
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Specific disclaimer: This report includes charts that may reference price levels. If market conditions change the price levels or any analysis based on them, we may not update the charts. All charts in this report are for informational purposes only. See the disclaimer for more information.
Disclaimer: No part of the analysis in this blog constitutes a trade recommendation. The past performance of any trading system or methodology is not necessarily indicative of future results. Read the full disclaimer here.
Charting and backtesting program: Amibroker. Data provider: Norgate Data
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