Dark Days Of Crude

Yesterday, after five consecutive down sessions, the market could have packed it in when an early rally began to fade. The S&P 500 and NASDAQ Composite rolled over into the negative column, but buyers finally arrived. So, after watching a lot of NFL Football announcers describe an avalanche of accolades-inducing Marque players being courageous and gutsy, I’ll show some restraint and say it was an encouraging session.

Market breadth was ho-hum, as there were more 52-week lows than highs.

Dark Days of Crude

Yesterday, oil stocks dominated the session, but they underperformed mightily against the S&P 500 over the past five years. During that period, the S&P 500 +106%, Energy (XLE) -11%.

There is no way crude oil stocks should be that far behind the broad market, but for political reasons, as deep-pocketed investors continue to shun them in order to appear as if they are Environmental, Social, and Governance (ESG) compliant (very few are).

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Portfolio Approach

There are no weighting changes this morning to the Hotline Model Portfolio.

Today’s Session

There were some key declines in parts of the CPI report on month-to-month basis:

• Airfares -9.1%
• New Vehicles -1.5%
• Car/Truck Rental -8.5%
• Lodging away from home -2.9%

Monthly CPI +0.3% consensus +0.4%

Lowest in seven months.

Yearly CPI core +4.0% consensus 4.2%

The headlines put some pep into the market, but those gains are fading a bit. Lately, the market has opened firmly only to stumble into the close.