A lack luster stock market

Weakness appears to be present in the stock market despite the advance of the major stock indexes. The action on Friday showed a small upward gap at the open followed by a very small movement higher during the day. All three major indexes had much lower than average volume. Big money is sitting out this rally.

Market sector analysis tells the story clearly. A bunch of sectors underneath the cyclical group lost ground this month including consumer durables, retailing, and media. The technology group also had difficulty with losses in computer software, technology hardware and telecommunication services. The only bright spot was a 3.7% increase in relative strength for autos.  The cyclical and technology groups power the stock market higher. There has not been a big push towards defensive sectors. however. This translates to sluggish, halting gains in the near future

Here’s the retail sector relative strength chart:retail

Here’s the auto relative strength sector:auto

 

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