S&P 500, NASDAQ Gains Wipe Out March Declines

Dow Jones Industrial Average (^DJI) Also Gained +200.64, or +0.8%

After the first week of across-the-board declines in 2019, stocks rallied sharply as both the S&P and Nasdaq eclipsed their month-to-date declines for March.

As we begin the second full week of the month. the S&P 500 (^SPX) rose +40.23, or +1.5% to 2783.30, while the NASDAQ Composite (^IXIC) gained +149.92, or +2.0% to 7558.06.

Meanwhile, the Dow Jones Industrial Average (^DJI) rose +200.64, or +0.8% 25,650.88, trailing other Major Market Averages. The underperformance was entirely attributable to Boeing Co (BA), which was -$22.53, or -5.3% to ~$400.01. This translated to ~-170 points on the DJI.

While the cause of the Ethiopian Airlines crash is yet to be determined, it did not have a “guilt by association” spillover effect into the Aerospace or Airline stock universe.

The Dow Jones Transportation Average (^DJT) rallied nearly +2%; +196.06 to 10312.92. This broke a losing streak of a 11 days for the DJT, allegedly the longest losing streak in a few decades, although I’ve seen conflicting details.

While long by duration, the extent was muted by many fractional, daily declines while the 2 largest were between -0.75% and -1.0%. During the 11 session losing streak the DJT lost -4.8% of its value from 10632.50 to 10116.86.

On Monday, it regained +1.9% in a single session.

Market internals were a clear sign of encouragement for investors as advancing issues led decliners by nearly 4 to 1 and Up Volume was 5x Down Volume.

The January Retail Sales report; +0.9 ex-autos and +1.1% from Core Retail Sales, was another positive data point on the economy. It reinforces what investors have seen of late from Housing, Jobs, Earnings, Productivity, and Business Investment, following the aberrant declines in December and early January.

We will get additional input on the economy this week, including reports on business optimism, durable goods, construction spending, industrial production and consumer sentiment.