The Canadian Vanguard Stock Market Report At Close – Thursday, February 22, 2024
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Data Driven Market Analysis And Report For Tomorrow’s Winning Trades
The Toronto Market
The TSX roared back today with a gain of 145.70 points or 0.69% to close today’s market session at 21,318.08.
The market session at the TSX today, was positive, buoyant and broad-based. Eight of the sectors ended the session with gains. Durable Consumer Goods & Services was up 1.92%; Industrials followed with 1.15% gain; Healthcare gained 1.01%; Financials gained 0.85%. Energy was up 0.69% while Utilities was up 0.46% and Technology was up 0.42%. Telecommunications Services was down -0.13% and Basic Materials declined -0.27%.
Containers & Packaging led the industries at the TSX today with a rather muscular 12.35% gain; Coal industry gained 11.25%; Electrical Components & Equipment gained 10.14%; Publishing followed with 8.67% gain and Chemicals – Agricultural gained 7.13%. Interestingly, none of the top five industry gainers yesterday made it to any of the top five positions today.
Today’s Statistics: There was a reversal of trend today. The gaining issues (advancers) totally outnumbered the declined issues (decliners) today after three sessions of domination by the decliners. The ratio of advancers to decliners was 2.17-to-1.0 or in practical terms, for every eleven advancers there were five decliners. In real numbers, 1,028 advancers to 473 decliners with 118 Unchanged. The total volume of shares traded for gaining stocks was 187,670,432 or 57.5%; the total volume for declined stocks was 130,567,147 or 40.0% and 7,939,323 or 2.4% for “Unchanged”.
There were 351 new 52-Week Highs and 30 new 52-Week Lows.
The total volume of stocks traded at the TSX today was 326,176,902 compared with 299,050,654 yesterday, a 9% increase. Today’s volume of 326,176,902 was two percent higher than the average of the ten most recent market sessions.
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The US Markets
All three indexes made good gains at today’s market session. The Dow Jones Industrial Average vaulted 456.87 points, or 1.18%, to close at 39,069.11. The S&P 500 was up 105.23 points, or 2.11%, to close at 5,087.03. The Nasdaq Composite soared 460.75 points or 2.96%, to close at 16,041.62. The gains today were large but the focus of our analysis of today’s market action, from an investment strategy considerations is the volume. The message really, is in the volume. We present the related discussion below in the “Stocks in the News” section.
Technology, with a mouth watering 3.57% gain, was the top performing sector today at the US markets. Discretionary Consumer Good & Services sector was up 1.76%; Industrials gained 1.28%; Healthcare gained 1.16%; Financials gained 0.75% while Basic Materials was up 0.64% and Energy was up 0.12%. Telecommunications Services and Utilities sectors were down -0.33% and -0.70% respectively.
Computer Hardware up 8.92% was the top industry performer at the TSX today. Semiconductors gained 8.63%; Advertising / Marketing gained 4.95%; Semiconductor Equipment & Testing gained 4.51% and Engineering & Construction was up 4%.
Today’s Market Statistics: Today, the gaining issues (advancers) outnumbered the declined issues (decliners) on the NYSE by a ratio of 1.88-to-1 or there were roughly two advancers for every decliner. In real numbers, there were 2,596 advancers to 1,381 decliners and 285 “Unchanged”. The total volume of volume-gaining stocks was 600,714,602 or 58.8%; the total volume of declined-volume stocks was 414,073,529 or 40.6%; and 5,973,818 or 0.6% “Unchanged”.
There were 602 new 52-Week Highs and 84 new 52-Week Lows. Yesterday, there were 155 new 52-Week Highs and 50 new 52-Week Lows. The market rally got more energized today, thanks to NVIDIA earning’s report and other good news. The bears appeared to have gone away on a really long extended lunch hour after analyzing and fully digesting NVIDIA earning’s report released last night.
The total volume of stocks traded at the NYSE today was 1,020,761,949 compared with 952,618,050 yesterday, a 7% increase. Today’s volume of 1,020,761,949 is about four percent higher than the average of the ten most recent market sessions.
On the NASDAQ, the advancers outnumbered the decliners by a ratio of 1.20-to-1 or roughly for every six advancers there were five decliners. In real numbers, there were 2,339 decliners to 1,942 advancers with 305 unchanged. The total volume of volume-gaining stocks was 3,286,601,149 or 56.6%; the total volume of declined-volume stocks was 2,477,619,360 or 42.6% and 45,284,385 or 0.8% for “Unchanged”.
There were 260 new 52-Week Highs and 112 new 52-Week Lows.
The total volume of stocks traded at the NASDAQ today was 5,732,566,309 compared with 5,327,181,736 yesterday, a 5% increase. Today’s volume of 5,732,566,309 is just one percent higher than the average of the last ten market sessions.
The market will do what it wishes to do regardless of what you and I think. The pattern we were trying to establish to our readers in yesterday’s report is no longer valid. The buoyant earning’s report and other good news today changed all that. The “Lows” today points at the relative lack of good spread with the really bullish components of the market. The big Technology stocks, got bigger today. A number of Technology stocks got even further extended but thanks to the decline of SMCI and the three days of declines that followed last week, the stocks are still within or under the new “Highs” reached early last week. The market rally clearly ran on octane power today, however, the downside is that the risk of a market pullback got higher.
Stocks In The News/Stocks To Watch
The US Markets
Markets’ Irrational Exuberance? Nothing keeps climbing for ever. Are we getting close to a market top? The last two weeks saw the indexes reaching new highs after new highs at market session after market session. However, we must separate market top from individual stocks peaking. There have been giant moves by stocks such as Nvidia Corp (NVDA) and Super Micro Computers Inc. (SMCI). The three US market indexes probably need to take a break now for some rest. Super Micro Computers made giant gaps up during the past three weeks but pulled back for three days last week until Nvidia earnings spurred the climb yesterday.
AI is part of the driving force behind the giant gaps up by the market. We are, however, far from the dotcom Irrational Exuberance era. The gaps up and corrections have so far been quite orderly. When Mr. Alan Greenspan, the former Board Chairman of the Federal Reserve raised the issue in December 1995 to warn against the dotcom recklessness, market had gone wild. Things so far have been different. Nvidia Corp and Super Micro Computers Inc. manufacture products that are not only in demand but are likely to remain in demand in the foreseeable future. AI has value and people and companies are planning to adopt the technology because of perceived values the technology is likely to bring to their operations. The technology requires “heavy computation”; the chips or complete systems required for such are solely manufactured by these two companies. There will be speculators and noise makers trying to make money off AI but these two companies are likely to continue making profits for some time to come because of what they produce.
The current market is nothing compared to the recklessness of the dotcom era and even if “irrational exuberance situation” develops later, Nvidia Corps and Super Micro Computers will most likely experience only little damage. The fact is that, the way we use computers is changing and these two companies are in the forefront of that change.
By the way the phrase “Irrational Exuberance” was popularized by Mr. Greenspan’s remarks in December 1995, but the phrase itself was most likely invented by Yale University Professor Robert Shiller.
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Regular Market Day Features
Beginner Investor’s (Canadian stocks) Watchlist
The Canadian Vanguard Chinese Stocks Watchlist
EV, Energy and Resource Stocks Watchlist
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