Risk On

Well that was a fun day. Let’s get right into some of the data.

100% of large cap financials were positive, which has now happened twice over the last six days. XLF is up 11.6% from the lows made on February 11th.

The transports, which were a major laggard all of 2015, are up 17.3% off their January 20th lows. All but two transports were positive today.

It wasn’t only the beaten down stocks that bounced. Below you’ll see large cap stocks broken down by decile based on YTD returns (1 best, 10 worst). Yes the weakest stocks did perform better than the strongest stocks, but today was strong across the board.

best worst

90% of S&P 500 stocks finished higher today but it wasn’t because of some crazy gap higher. 82.5% of S&P 500 stocks finished higher than the open.

Today was the 13th time since 2011 that SPY outperformed TLT by 4.2% (red dots)


Risk on was not just a today event; here is the performance of SPY/TLT over the last ten days, the strongest run since early 2015.


Emerging markets have been performing well lately, especially relative to the S&P 500, which has demolished it over the last few years. Today is just the third time since 2012 that the S&P 500 was up 2.3% while emerging markets were up 3.5%, outperforming U.S. stocks by 1.2%.


It’s also nice to see high-yield bouncing, today capped the strongest 10-day change for JNK since October 2011.


Nobody knows whether we’re out of the woods, or if we were ever really in them in the first place. I guess an interesting thing to think about, and probably the million dollar question, if you lightened up a few weeks ago, what do you do now?