Dow: -285.26…
Nasdaq: -88.72… S&P: -20.19…
The old NFL adage was always “defense wins championships”. Not really true anymore as offense wins championships and defense is just along for the ride. But back in the day it always mattered more.
However, when things get ugly in the market, it never hurts to play defense.
I’m not sure if this will end up being a one-off day because the entitled bulls didn’t get what they wanted vis-a-vis a delay in tariffs, but for now, we could be re-entering the “upside-down” (Stranger Things reference) for a while.
In any event, here’s what is working now, and these are not your “bull market” sectors by any stretch.
XLU– Utilities made new all-time highs today….defensive.
XLP– Diapers, soup, and bleach made new all-time closing highs today….defensive.
SLV– Are you kidding me? Silver explodes again +4.3%…Yowza!!!…defensive
GLD– Lagging silver, but still another closing high for the year. Defensive
The Russell 2000 (all your fun small-cap growth stocks) was down about 1.5%. IWM could be in trouble if it breaks that $144 level with any kind of big volume.
The theme, for now, is simple, sell growth and buy defensive “stuff”. Take a look at LYFT, UBER, WDAY, ULTA lately. WeWork goes public in a couple of weeks. That one should be a hoot.
The financials had a bad day. The regional banks (KRE -2.3%) were worse than XLF which was down 1.04%.
Retail doesn’t like tariffs, so XRT was -1.53%.
The big story continues to be treasuries (on their way to zero), as we are now just bips away from the historic low yield on the 10-year. That’s a monthly chart below and it goes all the way back to the Age of Pericles.
Yes, for you “youngins” out there, the 10-year yield actually did tag 15% back in 1981. Hard to believe. See the chart.
Have a great night.