Headwinds comin' ..?

Surprisingly,  day after a rally you’d expect some downward consolidation to take place,  even more surprisingly is given a horrible Retail Sales the market set a new closing high SPX 1012, (yet not a new intraday high).   If there is a finally a headwind potential coming for the market,  it will have materialized from today’s Retail sales number as we look days/ or a week back from now.    Production is picking up, but consumer is a clunker still.   Remember what we said as a theme for the recovery....“ If you build it, he will come!“.   Well, ..he..she..they are not yet coming which is disappointing, we did not think we'd see a 5th straight decline.    Also, for the 2nd straight day there is a divergence between asset classes, importantly equities and corporate credit which is a negative as the equity market attempts a breakout, a breakout squeeze so far with not a lot of conviction buying.  In last weekends Journal, we talked of a stall to blow off some 'bullish' steam,  despite a seemingly volatile week we will probably accomplish just that to close off the week..a stall and consolidation period.

As far as sector performance, second day of leadership from 2 of the big 3 as Banks- Brokers and Commodity linked stocks.  Even Tech traded well, particularly the semi’s.    All commodity stocks we favor can be found on our shadow list, as always we favor X-CLF  for steel, WLT-ANR-MEE  for coal,  FCX  (copper) to trade.    As far as Ferts, bad news is being shaken off today suggesting all the recent turmoil with pricing affecting stocks may be going away . (POT MOS ).   A casino play here, LVS  squeezed today, but it didn’t cause widespread follow through action as usually seen in the group.

Some earning notables off DJIM,  noted STEC  starting to shake off its offering before Wednesday trade, well, did it ever making a NCH with a 2 day sprint.  Others on Journal this week, SXCI PRE MAIL FIRE TXIC  were all pretty solid.