Daily Market Commentary

Despite a move higher in yields, stocks were mostly positive yesterday, and this time small caps not only played along, they led on the upside. The S&P 500 tagged 5000 but closed a couple of points below the milestone. Earnings released after the bell yesterday weren't great but none of the names were big markets movers.

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The media was falling all over itself about the S&P 500 flirting with 5000. I really wish it would have touched it so we could look past the celebratory hype. It's a big number and a sign that the large caps are acting quite well, but the rest of the market needs to catch up or it will all be for naught. The S and I-funds lagged and bonds (F) were down as yields held near support. The news flow is slow so it's all about 5000 right now.

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Stocks gained back some of Monday's losses on Tuesday despite the eerie sound of that rubber band stretching in the S&P 500, but as of now the market keeps climbing the wall of worry despite some signs that a pullback is needed, or at least due. Small caps led yesterday as yields eased lower after the two-day rally triggered by Friday's strong jobs report, and that also helped the F-fund rebound. The dollar was also down helping the I-fund to decent day as well.

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The new week started with some profit taking after Friday's big rally in the large caps, while small caps (S-fund), the I-fund, and bonds (F-fund) tacked onto Friday's losses. The Dow was down sharply and it gave back all of Friday's gains, and then some while the S&P 500 and Nasdaq each gave back a small percentage of Friday's move higher. Bonds were down sharply as yields moved sharply higher for a second day following the unusually strong jobs report.

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Strong earnings out of the Magnificent 7, and a much stronger than expected jobs report, gave us a very mixed day in the TSP funds on Friday. The S&P 500 (C-fund) is heavily weighted in big tech stocks and it benefited, along with the Dow, and of course the Nasdaq, with those Mag 7 earnings on Friday. But the unusually strong jobs report sent yields and the dollar up sharply, and that put a lot pressure on small caps (S-fund), the I-fund, and bonds (F-fund) on Friday.

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