The View from 5th Avenue

The View at Two – 8 July 2020

New records continue to break, and its sounding like a broken record.  While Nasdaq has not created a new high today (yet), the same trade theme is present.  Buy Tech (Semis, Internet, Software), and underweight everything else.  Some are even comparing the Tech performance as a safety trade seen similarly in Gold and Treasuries.  Homebuilders are actually the best group today (ITB +2.9%), getting a push from low yields, and therefore an increase in Mortgage Apps (+2.2% w/w). Most sectors have bounced 65-85bps since the Euro close, except Materials (chemicals weighing) which have continued their path lower.  Conversely, in commodities, metals continue their move back to levels last seen pre-covid.  Gold we understand, but copper is now only 2.8% away from the January highs and is u/c ytd (is it getting caught up in the China bull market?). 

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