Tuesday: Overnight Rally Fizzles Out
In the extended overnight session (Sunday night and Monday AM) the S&P 500 index futures went from slightly in the red to solidly in the green. In fact, the index opened above its all-time closing high (4225.25), went 4230 and sharply reversed course.
In a rare 30+ handle decline, the index was down 8.5 points, but found intraday support above the premarket low (4190) at 4195, but struggled for the remainder of the day. For the day, the index was a few points lower closing at 4200.
On a positive note, the index is still above its major support at the 4180 area from last week.
Movers
It took investors a day to digest Dell Computer’s (NASDAQ: DELL), strong Q1 beat for sales and revenues after losing over a $1 on Friday ($99.70 to $98.64),
Off the open, it easily sliced through Friday’s high ($99.73), the pair of highs at $100.50. The only thing that ended the rally was the closing bell, finishing the day higher $4.21 at $102.85.
A timely upgrade by Citigroup, going from Neutral to Buy, propelled NIO Inc. (NYSE: NIO) to 24 day high, ending the session higher $3.72 at $42.34.
More on NIO: https://tinyurl.com/3bux3nx8
Wednesday: Time To Move Away From 4200?
No. The index drifted higher off the open reversed course around Noon EST. Its daily came up well shy of Tuesday’s high (4230), only reaching 4230.
The retreat did not reach the overnight low (4190.75), finding buyers several times in the mid 4190 handle. A rally into the close boosted the index to its second all-time closing high gaining 7.75 points at 4206.25.
Movers
The race to own Nvidia Corp (NASDAQ: NVDA) continues into the 10 for 1 stock split effective June 10 as the issue obliterated its former all-time high from Tuesday ($655.53) finally peaking at $676.75. It backed off to end the day higher by $20.45 at 671.13.
While AMC Entertainment (NYSE: AMC) soared to unconscionable levels, Goldman Sachs is not bullish on its peers and downgraded both Imax Group (NYSE: IMAX) and Cinemark Holdings (NYSE: CNK), However, both of the issues rebounded sharply from the early morning lows and staged solid rebounds. Surprisingly, both issues ended the day in the green, Imax Group by $0.38 at $21.99 and Cinemark Holdings by $0.56 at $24.97.
More on these issues: https://tinyurl.com/2s5nec4f
Thursday: Time To Move Out Of Trading Range?
Just when it appeared the S&P 500 index was going to move out of its seven day trading range, it was right back in it. The overnight night continued into the regular session sending the index to an eight day low (4165.25), however, the “buy the dip mentality” prevailed once again.
The index recouped much of its earlier losses to end the session 15 points lower at 4191.25 which was just above the daily lows from Wednesday and Thursday.
Movers
General Motors (NYSE: GM) instigated a huge rally in the auto sector when it announced that it would increase production in the second half of the year as the recent chip shortage has eased.
The issue made a new all-time high,ending the session higher by $3.81 at $63.46. A sympathy move in Ford (NYSE: F) pushed the issue to six year high adding $1.08 to close at $15.99.
Meme stocks were in limelight once again and Blackberry Ltd (NYSE: BB) had nearly $7 range and closed higher by $0.63 at $15.88.
More on Blackberry: https://tinyurl.com/42n87372
Friday: Right Back Where Started From
On Tuesday morning the S&P 500 index flirted with all-time closing higher territory when it peaked at 4320 off the open. However, by Thursday’s session it swooned to 4165.25 and rebounded strongly to end the day.
Friday’s benign job data allowed a move higher that started in the premarket session. By the close, the index had surpassed Tuesday’s high, reaching 4232 and ended the week in the green by 25,75 points at a new all-time closing high at 4228.25.
Movers:
The growth technology continued to show signs of life with an impressive beat by Docusign (NASDAQ: DOCU). After the close on Thursday, the company reported quarterly earnings of $0.44 per share which beat the analyst consensus estimate of $0.28, Also, the company reported quarterly sales of $469.10 million which beat the analyst consensus estimate of $437.81 million.
The torrid rally from the after-hours and premarket session continued for the remainder of the day. Overall, the issue added $38.49 to end the week at $233.24. That marks the highest level for the issue since April 29, when it peaked at $236.11.
Non-market related article on The Belmont Stakes: https://tinyurl.com/t58esd2a
The Week Ahead
Expect some volatile price action, especially early in the week in the S&P 500 index futures. The reason being, the rollover from June to the September, will create air pockets during the day as investors attempt to sway out their June position (for longs, selling June and buying September) and for shorts (buying June and selling September),
Although Thursday is the official day that the front month becomes September, it usually takes until next Monday for the bulk of the volume to be September.
Of course, this takes place leading up the quadruple with expiration (a date on which stock index futures, stock index options, stock options, and single stock futures expire simultaneously) on June 18.
Earnings:
Monday, June 7, 2021
Before Market Open:
G-III Apparel Group (NASDAQ: GII)
After Market Close:
Stitch Fix: (NASDAQ: SFIX)
Marvel Technology Group: (NASDAQ: MRVL)
Tuesday, June 8, 2021
Before Market Open
Thor Industries (NYSE: THO)
After Market Close
Casey’s General Store: (NASDAQ: CASY)
Wednesday, June 9, 2021
Before Market Open
Campbell Soup: (NYSE: CPB)
After Market Close:
Gamestop (NYSE: GME)
RH (NYSE; RH)
Thursday June 10:
Before Market Open:
Signet Jewelers (NYSE; SIG)
Dave and Buster’s (NASDAQ: PLAY)
Friday, June 11
No major early releases
Technical Talk On The S&P 500 Index
Not much resistance in sight. Above the pair of highs from Tuesday (4230) and Friday (4232), the resistance level is the all-time high from May 10 (4238.25). Making new daily highs is not as important as posting new all-time closing highs as well.
Short-term weekly support is at 4210 which coincides with Friday’s intraday low (4209.25).
Issue With Upcoming Catalyst
With meme stocks being the fancy of Wall Street, it will be interesting to see how the Street reacts to Gamestop’s Q1 report after the close on Wednesday (EPS estimate ($0.71) and no estimates for sales.
Perhaps the Street’s reaction to the report will be an indication if any of the meme stock fundamentals will eventually be a factor in their price action.
With the issue in the no man’s land at $250 mine as well “flip a coin.”
