The markets start the week at or near record highs as sentiment continues to be extremely bullish. The S&P 500 (SPY ) hit record highs once again this week and the trend remains solidly in tact. Many believe that with tax reform on the horizon, it may be better to wait and lock in gains next year at potentially a lower tax rate. While this remains to be seen, investors are still content to push forward. For the year the SPY is now higher by almost 20%.
The Nasdaq 100 (QQQ ) is also near highs but has been unable to convince investors to push it to new records just yet. Weakness in some of the tech names has held back the index so far this week but there is no arguing the overall strength. For the year the QQQ is still in the lead with a 31% gain.
Financials (XLF ) were strong Tuesday which helped support the S&P 500 and the Dow 30. The XLF has added over 1% so far this week and is currently at highs for the year. With over a 7% gain since Thanksgiving investors should be pretty content going into the Fed meeting Wednesday where it is widely expected that they will raise rates a quarter point. Higher rates is bullish overall for the earnings of the banking sector.
Gold Mining (GDX ) stocks continue to push lower along with the price of Gold (GLD ). Traders have continued to push the stock lower after a technical breakdown a few weeks ago. The momentum has taken the ETF almost down to the next support area where it has bounced three other times this year.
Finally, Retail (XRT ) has seen some weakness this week. Tuesday the XRT fell 1.41% after spending the last few weeks in a strong push higher. Technical traders note the short term, over extension as the likely reason for profit taking. The last few weeks rally has put the XRT into positive territory, but just by a fraction of a percent.