There appeared to be a growing sense that getting the election out of the way would provide a catalyst for a relief rally, regardless of the outcome. The rally was being fueled by areas of the market that offer higher beta and are not dependent on one candidate or the other. Materials, industrials, semiconductors and banks all traded higher. The S&P 500 was up 0.79% and the Dow was up 1.02%.
Cyclical sectors outperformed for the second straight day. Large financials also did well. Materials stocks worked aggressively higher after AK Steel put through a price increase. Telecom and cable are lagging again today. Those areas of the market had done very well during the recent pullback. They are being used as a source of cash today to buy more risk-on areas of the market.
European stocks were up nicely. Higher beta stocks led in Europe with banks, industrials and technology all beating the broader market. Foreign currencies were relatively quiet. The U.S. dollar sold off sharply.
Commodities traded higher across the board. Precious metals and crude were the areas that displayed the most strength.
The technology sector saw more buying today. There were no real catalysts. The high beta carried by many technology issues led to buying again. Tech is not being led by Apple. Many areas of technology that have been hit hard lately have performed well all month. Microsoft again traded higher and is up over 4.5% for the month.
All areas of the financial sector traded well today. Credit card issues, money center banks and the major brokers/banks all traded higher.
The industrial sector was especially strong today. Large multi-line industrial names did well and early stage cyclicals like MMM, Emerson Electric and Rockwell Automation turned in good performance.
Source: PFS Group
