By Jeffrey Cohen, Investment Advisor Representative
US Advanced Computing Infrastructure, Inc.
Good morning. We see these key facts in the market today:
1. Multiple bank stocks had significantly higher volume on Friday. Banks made up most of the top 10 volume increases in our CQNS UP run.
2. Futures are up this morning on US Equities. Most of the economically sensitive sectors we track are also up pre-market, but not 100% of the stocks are up in each. This is a broad-based pre-market rally.
3. US Treasury Bond Yields are up this morning as bond futures fall. Bonds are still above their support levels having recovered over the past week, but are not making new highs either. Long-duration bond yields are higher this morning.
4. California wants to drop $1050 on every family with three or more members that own a car. This is to help pay for gasoline price increases, or other price increases that California families are facing. In our opinion, this is not a good idea. If you want to drop money on people, then leave quarters for people to pick up. This way, everybody gets some if they work at it and those that need the money can pick up more quarters.
5. Our CQNS UP run model has finally given up on individual stocks, and has selected the three US Equity Index ETFs as the three individually best performing (risk - return) tradeoff stocks. SPY, QQQ and IWM score better than any other individual stock. The market is 'rational' again and does not favor stock pickers. This is good to see, but also terrifying to see as it eliminates the edge that some traders have from running quantitative models like ours. Net-Net: if you have $100 to put into the market, the model suggests to invest it into one of the three ETFs above and not to pick an individual stock.
Bitcoin, currencies, commodities all look ok. No big changes.