Volatility Falls Back Below 20

U.S. markets

The stock market rebounded on Monday, with the broader market, the small-caps, and the blue-chips rising to end five-session losing streaks while Tech lagged after falling for the fourth-straight outing. Bullishness on the likely passage of a $3.5 trillion budget package helped sentiment, despite an expected proposal to raise the corporate tax rate to 26.5% from 21%.

Energy was the strongest sector after surging nearly 3% while Healthcare was the weakest after falling 0.6%. Meanwhile, volatility settled back below a key level of support despite kissing an intraday monthly high to remain in an overall four-month trading range.

The Dow closed at 34,869 (+0.8%) with the morning peak reaching 34,939. Fresh and lower resistance at 34,750-35,000 was cleared and held. A close above the latter and the 50-day moving average would indicate a possible near-term bottom with additional upside towards 35,250-35,500.
             
The Russell 2000 tested a midday high of 2,244 before ending at 2,240 (+0.6%). New and lower resistance at 2,250-2,275 was challenged but held on the close back above the 50-day moving average. A pop above the latter would suggest another run towards the 2,300 area. Below is a chart of the IWM.
             
The S&P 500 finished at 4,468 (+0.2%) after tagging a high of 4,492. Prior and lower resistance at 4,475-4,500 was breached but held. A move above the latter would indicate additional strength towards 4,525-4,550 with this month’s all-time peak at 4,545.
            
The Nasdaq settled at 15,105 (-0.1%) with the intraday low hitting 15,030. Key support at 15,000 was approached but held. A drop below this level would signal additional weakness towards 14,850-14,700 and the 50-day moving average.

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ANALYST UPGRADES/DOWNGRADES

CareMax (CMAX) upgraded to Overweight from Neutral at Piper Sandler
Dell Technologies (DELL) upgraded to Conviction Buy from Buy at Goldman Sachs
MGM Resorts (MGM) upgraded to Outperform from Market Perform at Bernstein

Crowdstrike (CRWD) downgraded to Neutral from Buy at Goldman Sachs
General Mills (GIS) downgraded to Neutral from Outperform at Credit Suisse
Nike (NKE) downgraded to Neutral from Buy at BTIG

TUESDAY'S EARNINGS ANNOUNCEMENTS 
Before the open: AstroNova (ALOT), Core & Main (CNM), FuelCell Energy (FCEL), MYT Netherlands Parent (MYTE)

After the close: Aspen Group (ASPU), Davids Tea (DTEA), European Wax Center (EWCZ), High Tide (HITI), Ibex (IBEX), Kaspien Holdings (KSPN), SkillSoft (SKIL)

TUESDAY'S ECONOMIC NEWS
NFIB Small Business Optimism Index - 6:00am
Consumer Price Index - 8:30am

METALS/ OIL
Gold closed at $1,794.40 an ounce, up $2.30
Silver settled at $23.80  an ounce, down $0.10
Copper finished at $4.37 a pound, down $0.08
Crude Oil was at $70.67 a barrel,  up $0.96
Bitcoin Investment Trust (GBTC) ended at $35.73 down $1.07

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

 Todd Mitchell

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