Technology and Materials have been the major drag on the market this week, through Wednesday. Surprisingly, Financials and Energy have held up pretty well. It’s tough for the Technology sector, the S&P 500, and the Nasdaq to perform when the biggest market-cap company—Apple (AAPL)—misses estimates for the first time in forever, I think. Or was it 2004?
The market responded well today to good economic news and to the positive and somewhat surprising response to the election of a moderate Iranian President. Some moderation in Turkey didn’t hurt either, and overnight positive markets in Asia and Europe gave bullish investors enough encouragement to buy equities broadly. We think it likely that this week the market will challenge highs that were set in late May.