loader image

Why a Major Sector Rotation Could Be Underway Amid Surging Inflation

by | Dec 10, 2021 | Market Updates

The market is gaining strength again after Thursday’s downward slide, even on the heels of the worst inflation data in four decades — and more in Friday’s stock market recap.

The slide we saw on Thursday shouldn’t have been a surprise after watching the market jump so high so quickly earlier this week. 

However, we are likely to see extended volatility on Friday for two reasons. One, there are less traders out as we move toward the weekend, meaning less liquidity. And two, we also have two more important reports being released, the Consumer Price Index and Consumer Sentiment. More on the data and inflation below…

The Senate voted to allow Congress to increase the debt ceiling, avoiding the risk of default.

And CEO Elon Musk offloaded roughly $1 billion worth of Tesla Inc. (Nasdaq: TSLA) shares, sending the stock price down another 1% following its recent 6% slide earlier this week. 

In this morning’s stock market recap video, you’ll learn which sector is cooling off and which is heating up… whether bonds have more downside to go… whether market internals are sending a warning sign… the current volatility levels you need to pay attention to… a review of a winning trade from this week… and a preview of major Federal Reserve data that’s on the table.

Don’t forget to like and subscribe to our YouTube channel if you haven’t already so you can be notified as soon as we post our next video and see what other trade opportunities we’re paying close attention to! 

 

Roger’s Radar: Inflation Sees Biggest Jump Since Reagan’s First Term

We got the latest inflation data this morning, which showed the fastest acceleration since 1982 during Ronald Reagan’s first term as president…

The Consumer Price Index rose 0.8% for the month of November, pushing the year-over-year rate up to 6.8%. 

Per CNBC:

Excluding food and energy prices, so-called core CPI was up 0.5% for the month and 4.9% from a year ago, which itself was the sharpest pickup since mid-1991.

The Dow Jones estimate was for a 6.7% annual gain for headline CPI and 4.9% for core.

Price increases came from familiar culprits.

Energy prices have risen 33.3% since November 2020, including a 3.5% surge in November. Gasoline alone is up 58.1%.

Food prices have jumped 6.1% over the year, while used car and truck prices, a major contributor to the inflation burst, are up 31.4%, following a 2.5% increase last month.

The Labor Department said the increases for the food and energy components were the fastest 12-month gains in at least 13 years.

Stock Market Recap: By the Numbers

This morning’s stock market futures recap: 

DOW (mini)

  • Close: 35,754.69. 
  • Futures: 35,836. 
  • Change: +177. 

S&P 500 (mini)

  • Close: 4,667.45. 
  • Futures: 4,692.5. 
  • Change: +32.75. 

NASDAQ (mini)

  • Close: 16,149.57. 
  • Futures: 16,283.25. 
  • Change: +131.75. 

RUSSELL (mini)

  • Close: 2,220.21. 
  • Futures: 2,235.2. 
  • Change: +19.8. 

Note: Updated as of 09:23 a.m. EST

P.S. My Complimentary Bootcamp Training Session for You!

Most traders are feeling lost right now…

And from what I’ve been hearing, it’s led to trade losses and missed opportunities. Heck, recent volatility has pushed some people to give up on trading completely… 

Nothing pains me more than to hear that! 

So I’m hosting a complimentary bootcamp training session to teach people my three most critical components for “profitable pullback” trading!

See You There!

 

Check back each morning for Roger’s Radar and the most important news and numbers in the WealthPress stock market recap.

WRITTEN BY<br>Roger Scott

WRITTEN BY
Roger Scott

What to read next

99 Problems and a “Pivot” is One

99 Problems and a “Pivot” is One

A friend of mine sent me this chart about three months ago. I should probably print it and keep it in my wallet next to a photo of my daughter. Given the sheer number of questions I’ve fielded lately, I’ll probably end up showing this chart more than her picture.

read more
Everything Everywhere, Going Down, All At Once

Everything Everywhere, Going Down, All At Once

When our momentum reading went negative last week, I didn’t know that we’d have the second largest bank failure in U.S. history three days later. All I knew was that it went negative… and that we got out of the way.

read more
Trust But Verify…

Trust But Verify…

I want to talk about our version of “Trust but Verify” in the markets. Qualification is the most important part of the investing process. And this F score value strategy looks to be crushing the current market.

read more

Have any questions? Contact Our Customer Service Team