ReElement Technologies stock soars after securing $1.4B government deal
The S&P 500 finished the day down about 1%, while the Equal Weight Index declined roughly 0.43%. This continues to reflect what we’ve been discussing in recent weeks — the growing divide between the tech-heavy segment of the market and everything else, driven, I believe, by insufficient liquidity to support broad participation across all sectors at once.
Speaking of liquidity, the reserve balance fell again this week, ending at $2.83 trillion as the TGA continues to climb, draining reserves from the system. Today marks both the month-end and a $58 billion Treasury settlement date, and I would expect overnight funding pressures to be fairly tight, with increased usage of the Standing Repo Facility.
In the meantime, the VIX actually closed lower on the day. But more importantly, the dispersion index fell and implied correlation rose — exactly what we’d expect now that earnings from the major stocks are out. I would expect this trend to continue today and into next week. As the spread contracts, the S&P 500 typically declines, and that’s what I anticipate happening going forward.
Amazon(NASDAQ:AMZN) is trading higher after hours, but the problem is that the call wall sits at $250. The $250 calls expiring today closed on Thursday at $0.83, down from $2.17 on Wednesday. With the stock trading around $251 after hours, those calls still aren’t worth much and will likely be dumped, which could cause the stock to give back a good portion of its after-hours gains.
Sorry, I have had a busy day and would really just like to keep this short.