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T3’s Market Wrap: The Russell and Retail Rockets Are Still Powerful


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Earnings season is just about done, but we're still not out of big winners.

Retail giant Target (TGT) shot up over 4% today after reporting better-than-expected earnings. This comes a week after competitor Wal-Mart's (WMT) stellar report, and a day after Kohl's (KSS) beat.

And interestingly, the Vaneck Vectors Retail ETF (RTH) is the #1 performer on my ETF tracking spreadsheet, with a nearly 20% gain year-to-date. It even beats tech by quite a margin.

In fact, take a look at this year-to-date chart.

Of course, it helps that Amazon.com (AMZN), one of the best performing stocks of 2018, accounts for over 20% of the ETF's holdings!

It was a big night for politican news.

President Trump's former attorney Michael Cohen pleaded guilty to 8 criminal counts, including 2 campaign finance violations.

Cohen testimfied that then-candidate Trump ordered him to commit a crime.

At about the same time, former Trump campaign manager Paul Manafort was found guilty of financial fraud.

I'm not going to pretend to play legal analyst, so let's focus on what the market is saying.

So far… it's not much. US equity futures came off morning lows and the Russell 2000 hit another record high.

And the VIX almost broke 12 again, and it's near historical lows.

The dollar is down modestly vs. the euro and flat vs. the yen, though gold is up for the fourth straight day.

And let's remember, we're coming off new all-time highs in the SPX and Russell 2000 yesterday. There's room for the market to fall in the face of a scare.

Of course, things can change, but let's take things one step at a time.

This afternoon, the Fed released the minutes from its July 31 – August 1 meeting.

Fed policymakers said it would “likely soon be appropriate to take another step in removing policy accommodation,” basically telling the market we're getting another rate hike soon.

However, Fed officials appear divided over the inflation outlook.

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