The S&P 500 traded in a very tight range yesterday…as investors waited for today’s CPI report. This is basically what took place last Thursday…when the market didn’t do much before Friday’s employment report. So, it was not a big surprise…..However, the Nasdaq and the Russell 2000 both did see some weakness as the tech sector took it on the chin. This weakness in the tech sector was led by the chip stocks…as Micron (MU) made a negative pre-announcement about their earnings. This followed Nvidia’s (NVDA) pre-announcement on Monday…and it sent the SMH semiconductor ETF lower by more than 4%.

This move in the chip stocks is an important development. As we highlighted in our weekend piece, the SMH was testing its early June highs…and it needed to break above those highs (and give it a key “higher-high”) if the group is going to see some more upside follow-through from its July rally. Instead, with yesterday’s significant drop, it looks like the SMH is going to fail at its key technical juncture. This is not good for the group…and given that the semis are an incredibly important leadership group for the broad stock market…it’s a negative development on several levels.

Having said all this, the SMH has only been falling for two days. If it can bounce-back quickly, the situation can be rescued. However, given that MU, NVDA, AMD, INTC, QCOM and several other chip companies have either reported lower-than-expected earnings or warned about their prospects for the rest of this year (or both), it’s going to be very difficult for this group to bounce back. (We thought the comment from the MU CEO…who said yesterday that things have turned down decidedly in the last month…was very telling.)

HOWEVER, we get the all-important CPI inflation number this morning. If that ...

We’ve seen some big intraday swings in the S&P 500 so far this month, but it’s funny how it tends to still close near the “unchanged” level on most days. In fact, the SPX is pretty much unchanged since the ...

Friday’s much stronger than expected employment report had an outsized impact on the bond market…as the yield on the U.S. 10yr Treasury note jumped from 2.68% to 2.83%. However, it did not have much of an impact on the stock ...

Our morning comment yesterday was “short and sweet.” Well, today is going to be pretty short and sweet as well…for the simple reason that a lot of things could change after the employment report comes out later this morning. We’re ...

The abundance of “Fed speak” that we knew we’d be getting this week has indeed pushed-back on the notion that the Fed is going to pivot quickly from the tighten policy that began this year. This, along with the concerns ...

Well, the stock market did extremely well on the two days we were off at the end of last week….and the rally had taken the S&P 500 to less than 2% from the 4,200 level that a lot of technicians ...

It’s funny, the success or failure of today’s Fed announcement and Chairman Powell’s press conference will be determined by how the stock market reacts to it. If it rallies, today will be deemed a success by the Street…and if the ...

The stock market remains on its low-volume upward trajectory…as investors continue to somehow think that “bad news is good news” for the stock market. Despite the lower LEI data, another number showing that jobless claims are rising, and an absolutely ...

The domestic stock futures are trading higher this morning. A lot can change between now and the opening, but if they can remain elevated, it will mean that the S&P 500 will open very near the key 3,900 resistance level ...

The CPI inflation number was higher than expected yesterday, but several pundits said that it was likely the last “hot inflation” report we’ll see. They could be correct, but who cares? If inflation is going to plateau at a level ...

The stock market took it on the chin yesterday, but it came on the lowest volume of the year for the composite volume (just 3.2bn shares). The breadth on the S&P 500 was not intense either…at less than 3 to ...

Those who are looking for inflation to take a back seat to other issues in the second half of the year are very likely be disappointed over the coming weeks……….It is very interesting to read and hear that so ...