Last week we mentioned that VALUATION and VOLATILITY were the words of the week, and that continued into this week. But after all was said and done, the S&P 500 eked out a six point gain on the week, closing at 6,734. On Monday major U.S. indexes rallied across the board on hopes that the record-setting U.S. government shutdown could be nearing an end. Investors also bought the dip in artificial intelligence names after last weeks sell-off, with the S&P 500 having a daily gain of greater than 1%, while the NASDAQ 100 had its best day since May 27 with a 2.2% gain. On Tuesday traders moved into parts of the market with lower valuations and less exposure to the artificial intelligence trade. The Dow Jones Industrial Average (DJIA) rallied more than 550 points to close at a record high, while the NASDAQ 100 slipped as Nvidia was among the most actively traded names on news that SoftBank sold its entire stake in the chipmaker for roughly $5.8 billion as it pivots toward investments such as OpenAI. On Wednesday the DJIA extended its gains notching its first record close above 48,000 as Wall Street looked ahead to a potential end to the record-breaking U.S. government shutdown. Thursday was a reversal of Mondays gains as AI valuation woes continued. By the closing bell the NASDAQ 100 was down just over 2% and the S&P 500 having a loss of greater than 1%. That sell-off continued into Friday as the S&P 500 gapped down at the open with a loss of over 1%. However, the good news was that it was also the intraday low as the S&P 500 clawed its way back to finish in positive territory for the week letting everyone have a sigh of relief. We mentioned volatility in our first sentence so lets peel that onion back a little. Looking at the charts, bullish trends are defined by higher highs and higher lows. Bearish trends are lower highs and lower lows. Two weeks ago the S&P 500 intraweek high was 6,920, and last week the intraweek high was 6,882. This week it was 6,869, making it two consecutive weeks of lower highs, not higher highs. However, last week the intraday low was 6,631, this week 6,646, a higher low. So were in that middle zone where we have a lower high offset by a higher low. As such next week will be interesting as we have FOMC minutes and Nvidia earnings on Wednesday. For TSP TIPS lets look at some C/S/I data. The S fund has the lowest Composite Score (CS) and Performance Ranking (PR), was down for the week, and is in that mid-zone trend. The C fund is #2 in the Composite Score (CS) and Performance Ranking (PR), was up for the week, and is also in that mid-zone trend. Finally, the I fund tops both the Composite Score (CS) and Performance Ranking (PR) leaderboards, made a new 52 week high on Wednesday (knocking the C fund from the top of the PR leaderboard), was up for the week, and has a bullish higher high/higher low trend. As such we are recommending the following new investment mixes.
Last week we mentioned that VALUATION and VOLATILITY were the words of the week, and that continued into this week. But after all was said and done, the S&P 500 eked out a six point gain on the week, closing at 6,734. On Monday major U.S. indexes rallied across the board on hopes that the record-setting U.S. government shutdown could be nearing an end. Investors also bought the dip in artificial intelligence names after last weeks sell-off, with the S&P 500 having a daily gain of greater than 1%, while the NASDAQ 100 had its best day since May 27 with a 2.2% gain. On Tuesday traders moved into parts of the market with lower valuations and less exposure to the artificial intelligence trade. The Dow Jones Industrial Average (DJIA) rallied more than 550 points to close at a record high, while the NASDAQ 100 slipped as Nvidia was among the most actively traded names on news that SoftBank sold its entire stake in the chipmaker for roughly $5.8 billion as it pivots toward investments such as OpenAI. On Wednesday the DJIA extended its gains notching its first record close above 48,000 as Wall Street looked ahead to a potential end to the record-breaking U.S. government shutdown. Thursday was a reversal of Mondays gains as AI valuation woes continued. By the closing bell the NASDAQ 100 was down just over 2% and the S&P 500 having a loss of greater than 1%. That sell-off continued into Friday as the S&P 500 gapped down at the open with a loss of over 1%. However, the good news was that it was also the intraday low as the S&P 500 clawed its way back to finish in positive territory for the week letting everyone have a sigh of relief. We mentioned volatility in our first sentence so lets peel that onion back a little. Looking at the charts, bullish trends are defined by higher highs and higher lows. Bearish trends are lower highs and lower lows. Two weeks ago the S&P 500 intraweek high was 6,920, and last week the intraweek high was 6,882. This week it was 6,869, making it two consecutive weeks of lower highs, not higher highs. However, last week the intraday low was 6,631, this week 6,646, a higher low. So were in that middle zone where we have a lower high offset by a higher low. As such next week will be interesting as we have FOMC minutes and Nvidia earnings on Wednesday. For TSP TIPS lets look at some C/S/I data. The S fund has the lowest Composite Score (CS) and Performance Ranking (PR), was down for the week, and is in that mid-zone trend. The C fund is #2 in the Composite Score (CS) and Performance Ranking (PR), was up for the week, and is also in that mid-zone trend. Finally, the I fund tops both the Composite Score (CS) and Performance Ranking (PR) leaderboards, made a new 52 week high on Wednesday (knocking the C fund from the top of the PR leaderboard), was up for the week, and has a bullish higher high/higher low trend. As such we are recommending the following new investment mixes.