Utilities Led the Market Last Week

Utilities were up 4.8% last week whilst semis, EV, department stores and online retailers were shattered for 10%+. It capped off an otherwise brutish month of June, one that presided over scores of corpses STACKED HIGH and prepped to be tossed in the fires of summer. The bigger story for June, however, was the absolute disintegration of the commodity sector: oils, copper, metals all down 20%+. In a sense, there’s no place to hide and you ought to be mindful where you place your money. It’s important to note the biotech sector BOUNCED by 2.6% for June and more specifically Gene Editing stocks rose by 11%. I once did some research on biotech during the financial collapse and much to my surprise biotech did BETTER than tech.

In regards to utes and other dividend paying stocks outperforming: this is a result of the treasury yields coming in. As yields come in investors will bounce around asset classes attempting to find yields for income. The safest bet would be TLT or a leveraged approach with TMF.

I will not sugar coat it: the market is doomed to cascade lower into the flames and all those long heavily into the summer climes are to be roasted belly first. But before that happens, I am looking for a rally. It’s hard to keep up, and frankly I do not expect you to understand how I think. I’ve given up on the notion that I could teach anything to anyone when I barely know what I will think tomorrow — since I am so prone to changeability.

We have traded higher for 14 consecutive Julys and although you might want to believe that streak will continue, in order to provide yourselves with a small respite whereby you could extricate yourselves from the market and sigh in relief — there will be no relief and no one is coming to save you.