Rover’s Weekly Market Brief – 07/02/2021

Sector Rotation Strategies for Stocks and ETFs

Dan Shane of StockScreenerTips.com, a partner of Stock Rover, discusses the basics of sector rotation and how to implement effective sector rotation strategies for both and Stocks and ETFs. You can view Dan’s article here ^[1].

Economy

 

The Conference Board’s Consumer Confidence Index ^[2] increased in June to a pandemic high of 127.3, bettering the upwardly revised 120 May reading. The Present Situation Index, which is based on consumers’ sentiment of current business conditions and the labor market, improved to 157.7, up from 148.7 in May. The proportion of consumers planning to purchase homes, automobiles, and major appliances all rose, vacation intentions also rose. The Expectations Index, which measures consumers’ short-term outlook for income, business, and the job market, increased to 107.0, up from last month’s 100.9 reading. The share of consumers that indicated jobs were plentiful increased to 54.4%, up significantly over May’s 48.5%. The share of consumers who said jobs were hard to get dropped to 10.9%, down from 11.6%. The percentage of consumers who said business conditions are “good” increased to 24.5%, up from 19.9% last month.

The Energy Information Administration reported ^[3] a crude oil inventory decline (excluding those in the Strategic Petroleum Reserve) of 6.7 million barrels for the week ending June 25th to 452.3M barrels. U.S. crude oil inventories are running about 6% below the five-year average for this time of year. Crude oil refinery inputs averaged 16.3M barrels per day, a 187,000 barrels per day increase over the previous week’s average. Refineries operated at 92.9% of their operable capacity last week. Crude-oil production was unchanged from the previous week at 11.1 million barrels a day. Gasoline inventories increased 1.5M barrels to 241.6M barrels with an unchanged five-year average for this time of year. Distillates decreased by 0.9M barrels to 137.1M barrels and are about 5% below the five-year average. Total commercial petroleum inventories increased by 4.6M barrels. U.S. crude oil imports averaged 6.4 M barrels, decreasing by 0.5M barrels per day from the previous week. Total products supplied over the last four-week period averaged 20.0M barrels per day, up 13.3% over the same period last year.

The U.S. Bureau of Labor Statistics reported  ^[4]the unemployment rate ticked up slightly in June to 5.9%. However, 850,000 jobs were added handily besting May’s revised total of 583,000. Employment in June was still down by 6.8 million jobs as compared to pre-pandemic levels. Gains were especially strong in leisure and hospitality which added 343,000 jobs, accounting for 40% of June’s increase. Hotels and other accommodations, as well as arts, entertainment, and recreation both added about 75,000 jobs. Retail added 67,000 jobs, with strong growth in clothing and merchandise stores. State and local government education added 230,000 jobs. Modest declines were reported in motor vehicle manufacturing down 12,000 and construction down 7,000. The number of job leavers, those who quit their previous job and began looking for new employment increased by 164,000 to 942 000 showing increased confidence by workers in their ability to change jobs. The labor force participation rate remained unchanged at 61.6% in June.

Upcoming Economic Reports:

Tuesday July 6 – Purchasing Managers Index (PMI) Composite Flash

Wednesday July 7 – JOLTS Job Openings (May)

Earnings Calendar:

 

 

Monday	Tuesday	Wednesday	Thursday	Friday
Julius Bear Gruppe (JBARF)	Computer Services (CSVI)	MSC Industrial Direct Co (MSM)	Levi Strauss (LEVI)	AZZ (AZZ)
Naspers (NAPRF)	Straumann Holding (SAUHF)	WD-40 (WDFC)	Pricesmart (PSMT)	Greenbrier Companies (GBX)