1. Nasdaq, Tech, Growth Keep Going

With Technology rallying and once again outperforming to start the new trading week, we wanted to note that the sector’s weighting in the S&P 500 has pushed above 27% recently up to 27.2%.  That’s nearly twice as big as the next biggest sector in the S&P — Health Care — at 14.5%.  Just three other sectors have weightings above 10%, and they’re all just only slightly above the 10% mark — Communication Services, Consumer Discretionary, and Financials.  We’d note that Amazon (AMZN) makes up about a quarter of the Consumer Discretionary sector’s 10.8% weighting in the S&P, and while it is technically a retailer, between its web services division, and strong technology platform, you could argue that its just as much a Technology stock as it is Consumer Discretionary.

Industrials and Consumer Staples have seen their weightings dip below 8%, and the four smallest sectors each have weightings of just 2-3%.

At the moment, Tech’s 27.2% weighting in the S&P is larger than the weightings of the six smallest sectors combined.

1. Personal Savings Rate Spikes to 33%

U.S. savings rate hits record 33% as coronavirus causes Americans to stockpile cash, curb spending

Maggie Fitzgerald@mkmfitzgerald

Key Points

• The personal savings rate hit a historic 33% in April, the U.S. Bureau of Economic Analysis said Friday.
• “There is a tremendous uncertainty and virus fear that is lingering and that is restraining people’s desire to go out and spend as they normally would,” said Gregory Daco, chief U.S. economist at Oxford Economics. 
• With the U.S. consumer accounting for more two-thirds of the economy, the economic recovery depends on whether the increase in savings is a result of shutdowns or structural changes in consumer habits, analysts said. 
• The increase in savings came as spending declined by a record 13.6% for the month.

1. S&P 500…Price and Profit Margins Diverge

‘La la land?’ The stock market is ‘insanely disconnected’ and due for a ‘reckoning,’ Warren Buffett buff warns–By Shawn Langlois

https://www.marketwatch.com/story/the-markets-in-la-la-land-and-one-warren-buffett-buff-warns-of-an-imminent-reckoning-for-oblivious-investors-2020-06-18?mod=home-page

1. Dow Utilities, Industrials and Transports Still Below Highs.

Utilities -15% from highs

1. Record 78% of Investors Say Market in Overvalued.

Dave Lutz Jones Trading

Pain trade is still up: Record net 78% of investors say stock market is “overvalued.” Most since start of the series in 1998.   On the market rally, 37% say it’s a bull market while 53% say it’s a bear market rally

Among surveyed investors, 18% expect a V-shaped recovery and 64% expect a U- or W-shaped bounce – Second wave of Covid-19 remains biggest tail risk