Tech highs, liquidity spigots, crypto week: Market takeaways
To watch more expert insights and analysis on the latest market action, check out more Asking for a Trend here.
The NASDAQ hits a fresh record close as the S&P 500 posts a weekly gain for more than trading day takeaways. Let's bring in Yahoo finances, Jared Blickre. Jared.
Thank you, Josh. You said it, NASDAQ record highs, thanks to tech, and that is my number one takeaway. Tech at record highs. And let's just take away a look at some recent price action. Uh, let's go to the NASDAQ composite, and I will look at a two-month candlestick chart. You know I love candlesticks, and you can see the trend has been up, up, and away since about June 20th. So, three weeks or so, we've had this extension. Now, contrast that with the S&P 500. It has just been treading water, managed a new record close yesterday, managed a new record intraday high on the open today, but essentially kind of stuck in there. It's been really fascinating to watch what is working and what is not. So, people have been talking about bad breath, and that is the case that we haven't seen a lot of stocks climbing, uh, and participating, and that kind of speaks as to why the S&P 500 is stuck in a holding pattern. But then we've seen a lot of the smaller stocks and some former meme stocks really get, uh, kind of lift off here. And here's the sector action. Tech up 2% for the week, followed by utilities. That was interesting. But let me go over to our meme stock board, and we saw a lot of action in here. Remember pilot Palantir? That's, uh, this is a large cap stock now, up 8%, Coinbase hitting record highs, Hood up 11%, but I want to hit Carvana. It was up 1.1% this week, nothing to write home about, but here's the max chart, and this is which catching my eye. This was a $350 stock in the meme stock craze of 2021, lost 99% of its value, closed at $3.55 in December of 2022. And guess what? After being down 99% to get back up to those record highs, it had to 100x, and that's what it has done. And so that is just kind of telling you what is going on. So, there's a lot of money, it's just trying to find a home in the markets right now.
What's behind the strength in, in risk assets, Jared? Like tech and the meme stocks you're highlighting there?
The global liquidity spigots. So I was just taking a look, um, after reading the blog of Michael Howell today, he talks about liquidity and central bank, uh, spigots, and that is what we are seeing right now. China started really printing last year in September, that is catching up. What we're looking at here, in green is the S&P 500. This goes back to 2003, 2004. Uh, could be log scale, uh, but we'll stick with this. And then we have global M2 money supply year over year, and this is a percentage, and you can see in the white here, it goes up, it goes down. But what we're seeing right now after this big pandemic up and then down crashing into negative territory, it is now peaked above this high that we saw earlier last year, and now we are at the highest level since 2022 or 2021, and on the way up, basically the highest level on the way up since 2020. And so that is why I think we're seeing a lot of this kind of strange price action. You throw in a week dollar, and you got the floodgates.
It's Friday. Yeah. We know Bitcoin doesn't sleep. So what are you seeing in crypto?
Crypto week wrap. And let's take a look at this, because, uh, we saw a lot of action, not necessarily in Bitcoin. Let's take a look, and we'll do five days since Monday. See, Bitcoin down 2%, but Ethereum really took off up 16%. Let's take a quick look at that chart. We'll do a six years so we can see pre-pandemic and how it's just been kind of looks like it's ready to break out of a trading range right here. Hasn't happened just yet, but if it breaks free, that just gives it a lot more momentum, and then if it does, I'd be surprised if it doesn't take that out, at least test it. And then here's another one, Ripple. Ripple has been testing all-time highs. It's exceeded some of these highs, depending on which exchange you're looking on, but look at that. Uh, this is right up against the highs that we saw in 2018. Ripple was kind of left for dead in 2020 after the SEC was going after it, but it is back to life. And I just want to show you the equal weight version of what's happened this week. Lots of action there, not a lot of downside action, and I've been talking about the breadth in crypto. Well, there you have it.
What's on your radar next week?
I got earnings. I'm watching commodities, especially platinum, palladium, doing a hit on that Monday morning. And, uh, also the dollar. Is it going to go up? Is it going to go down, going to go down? We'll have to see.
We shall see. Thank you, Jared. Appreciate it.
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