Small-Caps Shine Despite Bearish Week

U.S. markets closed higher for the 2nd-straight session and ahead of President Trump and China President Xi’s face-to-face meeting at the G20 gathering over the weekend. The talks are not expected to result in a trade deal, although an agreement to continue trade negotiations would likely soothe fears of a breakdown in negotiations.

Friday’s action came after a number of Big Banks passed the Fed’s annual stress test and got the okay to raise dividends and share buybacks. The was a bullish signal for the market as the Financial sector is back to challenging late April and early May resistance levels on the breakout.

The Russell 2000 was up for the 3rd-straight session after soaring 1.3% while reaching a late day peak of 1,568. Prior and major resistance from mid-June and early May at 1,575 held with continued closes above this level getting 1,585-1,600 back in focus.

The S&P 500 was up 0.6% after settling 2 points off its session top of 2,943 ahead of the closing bell. Near-term and lower resistance at 2,950-2,975 held with the recent all-time high at 2,964.

The Nasdaq gained 0.5% to extend it winning streak to 3-straight, as well, after testing a high of 8,010. Current and lower resistance at 8,000-8,100 was cleared and held with the all-time high 2% away from triggering.

The Dow snapped a 2-session slide after advancing 0.3% while kissing a midday high of 26,638. Near-term and lower resistance at 26,600-26,850 was cleared but held by a smidge with the early October 2018 all-time and the 52-week high at 26,951.

For the week, the the Russell 2000 rose 1.1% while the Nasdaq gave back 0.4%. The Dow was down 0.5% and the S&P 500 was lower by 0.3%. For the month of June, The Nasdaq zoomed 7.4%; the Dow jumped 7%; the S&P 500 surged 6.9%; and the Russell 2000 rallied 6.8%.

Financials and Energy paced sector strength after rising 1.4% and 1.2%, respectively. Consumer Staples and Technology were the only sectors that showed weakness with dips of less than 0.1%.

The best performing sectors for the week included Materials and Financials (1.4%), Industrials (0.4%), and Energy (0.2%). The leading laggards were and Real Estate (-2.7%), Utilities (-2.2%), and Healthcare (-1.2%). For June, all sectors closed higher, led by Materials (up 9.9%) and Technology (6.8%).

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AutoZone (AZO) upgraded to Outperform from Perform at Oppenheimer
Procter & Gamble (PG) upgraded to Buy from Neutral at Goldman Sachs
Smart Global (SGH) upgraded to Buy from Hold at Needham

Darden (DRI) downgraded to Equal Weight from Overweight at Stephens
Live Nation (LYV) downgraded to Sell from Neutral at Citi
Walgreens Boots Alliance (WBA) downgraded to Neutral from Outperform

Before the open: Singing Machine (SMDM)

After the close: Aethlon Medical (AEMD)

Monday's economic reports (EST): 
PMI Manufacturing Index - 9:45am
ISM Manufacturing Index - 10:00am
Construction Spending - 10:00am

Gold closed at $1,4123.70 an ounce, up $1.70
Silver settled at $15.34 an ounce, up $0.05
Copper finished at $2.70 a pound, down $0.01
Crude Oil was at $58.20 a barrel, down $1.26
Bitcoin Investment Trust (GBTC) ended at $15.13, up $1.31

  I hope this helps you prepare for the trading day. Make it a great one!

   Todd Mitchell

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