We saw today’s market activity preferences emerging before today’s opening bell: the -10% from record highs on the Nasdaq was something of a dinner bell for investors to come back to the table to once again obtain their favorite tech stocks. The tech-heavy index, which had been trading more than +500 points during the intraday, closed +3.7% or 465 points. It was led by a 19% gain in
Tesla
TSLA
shares on the day. The Nasdaq is now once again positive for 2021.
The Dow had again reached a new all-time high intraday, up 348 points, but melted down to +30, or +0.1% on the day. Still, this counts as the third day in a row finishing higher, as rotation into cyclicals continues somewhat, even as growth-oriented stock plays owned the day.
Boeing
BA
helped boost the Dow with its first positive month of new plane orders since November of 2019. A total of 31 new aircraft were delivered, including 18 737 MAX planes.
This was also a day that saw bond yields cool, to 1.535%. Still, this puts us at the highest level since February 2020 (pre-pandemic, but just), though it’s lower than the 1.6% we’d been seeing. The closer yields go to 2%, the closer the Fed comes to making a decision about pulling the rug out from under the “cheap money for longer” mantra. Not that there is any indication this type of activity in imminent near-term, but it is what investors have started to hedge against since stronger economic reads have started to pop up.
In order to see the global economy as building back from pandemic lows (and staying higher), one must look beyond the U.S. and to other countries, such as China. Today, for instance, we see a 13.5% gain in
Baidu.com
BIDU
shares. China’s premier Internet Service Provider (ISP) filed for a second listing on the Hong Kong exchange, as is in the midst of bouncing back from a sell-off. So see this much as you see Tesla gains on the day; Tesla, even +19% today, is still down year to date.
Tomorrow morning brings us a new read on inflation with the Consumer Price Index (CPI) for February. Expectations are for a bump up to +0.4% from +0.3% the previous month. Core CPI is expected to come in barely above breakeven, above the 0.0% reported in January. Between this print and Friday’s Producer Price Index (PPI), we get a snapshot of last month’s supply/demand equilibrium.
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