The Canadian Vanguard Stock Market Report At Market Close – Friday, February 23, 2024
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Data Driven Market Analysis And Report For The Week Ending February 23
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The Toronto Market As At Friday
The TSX gained 95.07 points or 0.45% to close today’s market session at 21,413.15.
Seven of the major sectors gained today. Technology was the top performing sector with 1.53% gain. Technology was the top performing sector for the second consecutive session. Basic Materials, essentially mining companies and services, was up 0.94%; Healthcare gained 0.67%; industrials was up 0.61% and Financials gained 0.43%. Telecommunications Services was down-0.08%; Energy was down -0.14% and Utilities sector was down -0.19%.
Textiles & Leather Goods, up 16.67% was the top performing industry; Computer Hardware was up 8.64%; Retail – Apparel & Accessories was up 3.10%; Beverages – Non Alcoholic was up 3.05% and Pharmaceutical – Generic & Specialty was up 2.54%.
For the week Healthcare gained 4.04% to lead the sectors; Durable Consumer Goods & Services gained 3.18%; Energy, up the last two weeks, gained 3.11%; Telecommunication Services was up 1.23%. Technology was down -3.56%. Technology was the only sector on the TSX which did not gain this week on a weekly basis.
Today’s Statistics: The gaining issues (advancers) totally outnumbered the declined issues (decliners) today. The ratio advancers to decliners was 2.29-to-1.0 or in practical terms, for every twenty three advancers there were ten decliners. In real numbers, 1,033 advancers to 450 decliners with 113 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 354 new 52-Week Highs and 29 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.
The US Markets
The US markets were mixed as Dow Jones Industrial Average and the S&P 500 were up but Nasdaq suffered a decline today. The Dow Jones Industrial Average was up 62.42 points, or 0.16%, to close at 39,131.53. The S&P 500 was up 1.77 points, or 0.03%, to close at 5,088.8. The Nasdaq Composite declined -44.80 points or -0.28%, to close at 15,996.82. Volume today was down 10% across the market. The importance of the volume of shares traded cannot be over emphasized. When it comes to analysis and decision support, the volume of shares traded is often more useful, more important than the actual gain or decline of a stock.
Industrials was the top performing sector today with a gain of 0.61%; Utilities followed with a gain of 0.60%; Basic Materials gained 0.46%; Healthcare gained 0.46% and Telecommunications Services gained 0.37% while Financials gained 0.16%. Technology was down -0.26% and energy was down -0.43%.
All the major sectors were up for the week. Financials was the top performer with a whopping 15.87% gain. Healthcare gained 1.94% and Industrials sector followed but up a mere 1.71%. Durable Consumer Goods & Services gained 1.38%.
Today’s Market Statistics: Today, the gaining issues (advancers) outnumbered the declined issues (decliners) on the NYSE by a ratio of 1.86-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 543,437,755 or 60.4%; the total volume of declined-volume stocks was 344,916,055 or 38.4%; and 11,034,912 or 1.2% “Unchanged”.
There were 663 new 52-Week Highs and 94 new 52-Week Lows.
The total volume of stocks traded at the NYSE today was 899,388,722 compared to 1,020,761,949 yesterday, a 12% decrease. Today’s volume of 899,388,722 is about the average of the ten most recent market sessions.
On the NASDAQ, the advancers outnumbered the decliners by a ratio of 1.21-to-1 or roughly for every six advancers there were five decliners – just a repeat performance of yesterday’s market in this regard. In real numbers, there were 2,344 advancers to 1,933 decliners with 347 unchanged. The total volume of volume-gaining stocks was 2,530,081,046 or 48.5%; the total volume of declined-volume stocks was 2,585,662,297 or 49.5% and 104,261,097 or 2.0% for “Unchanged”.
There were 279 new 52-Week Highs and 138 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.
On the NASDAQ, the advancers outnumbered the decliners but the volume of stocks with increased volume was lower than the stocks with declined volumes further illustration of the fact that volume was down a whole ten percent on the NASDAQ at Friday’s market session. The few stocks which gained on Friday did so with lower volume of shares traded. A possible risk with the market in the short term is that investors may start to take profit and in doing so start a pullback. A bit of a pullback now will actually be good for the market as the indexes and a good number of stocks are stretched.
The market outlook remains trade with caution. The risk of a market pullback got higher as of Friday.
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Stocks In The News/Stocks To Watch
The Toronto Market
Badger Infrastructure Solutions Ltd (TSX:BDGI) has been a good performer this year. The stock is currently working on flat base within a narrow range. The Q4’2023 earnings report is scheduled for Friday this week, February 29th. Last year’s earnings came in at $0.12 but analysts estimated $0.33 when the company reports on Friday. Will the company beat the estimates? If it does the stock will surely continue to climb. There is of course risk associated with holding onto volatile stocks when an earnings report is due.
The US Markets
Are we trending towards Markets’ Irrational Exuberance? Nothing keeps climbing for ever but are we 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 which keeps the current rally going.
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
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The Canadian Vanguard Chinese Stocks Watchlist
EV, Energy and Resource Stocks Watchlist
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