Your Thursday Blip 1/14/21

Your Thursday Blip 1/14/21

Markets opened higher today on stimulus hopes but as the trading session came to a close the Dow had reversed and posted a loss of 68 points at 30,919. It was a choppy day as big tech stocks were lower while banks and materials moved generally higher. Trading volume was higher on the Dow. Both IBD and BTS indicators remain positive.
Big banks are lining up to report earnings. JP Morgan and Citigroup report Q4 results tomorrow and longtime guru Dick Bove is predicting that results will be better than expected. Since the pandemic lockdown began bank deposits have risen sharply. One figure I saw was that savings rates during the pandemic rose to over 30% from a normal range of 5%. Data from the Fed shows total bank deposits at $16 trillion up from $13 trillion a year ago. Eventually all that money has to go somewhere and when it does it could be impressive!
Stimulus talk on capitol hill is pushing treasury yields up with the 10 year rising to 1.11% which is the highest level since late March. The spread between the 2 year and 10 year is also steepening which indicates future economic growth with potentially higher inflation and interest rates. One immediate effect of these changes in interest rates is spark a rush to refinance mortgages and lock in historically low rates. Another effect is on bank stocks which have risen as of late since rising rates tend to boost net interest margins.
In what may develop into a trend retailer Dollar General has become the first company to give its workers four hours of pay equivalent for getting a covid-19 vaccination. I guess they call that “paid vaccination” instead of “paid vacation”. Ha ha!