The View from 5th Avenue

The View at Two – 26 August 2020

Well It WAS Looking Like a Pre-Fed Snoozefest… With futures in a holding pattern pre-market, but it should be no surprise by now to see the S&P and Nasdaq shooting towards another record close on back of the usual Software / Media / Tech workhorses. Salesforce (CRM +27%) is providing a little extra giddy-up for the space after topping off its inclusion in the Dow with a monster earnings beat, but the rest of the Big 5 are throwing their weight around as well. Retail is also in the outperformers mix, buoyed by all-time highs for Home Depot, Lowe’s and Ulta Beauty ( to name a few) as non-S&P names Dicks Sporting Goods (DKS +15%) and Urban Outfitters (URBN +19%) delivered their own impressive results. The mini-rotation to Value at the end of last week seems to be decidedly over, with Energy, Banks, and Industrials all in the red. The 10-year Treasury yield is remains elevated near June levels along with the USD, both rising in anticipation of a bit of inflation ahead as Powell is expected announce in his speech tomorrow morning that the Fed will be more tolerant of inflation above its usual 2% goal in deciding when to raise rates (again, they said they’re “not thinking about thinking about it”).

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