Mike Santoli's market notes: Corrections are processes, Apple tussle intense, Nike revaluation

Published Wed, Sep 23 20201:27 PM EDT

This is the daily notebook of Mike Santoli, CNBC's senior markets commentator, with ideas about trends, stocks and market statistics. (This story is for CNBC Pro subscribers only.) Corrections are processes, and usually leave everyone a bit off balance as they move along. Bounces alternating with backslides, one day the market seems in the clear, the next back in the soup. Fitful, inconclusive trading today, Nasdaq digesting its bounce and the S & P 500 wavering a bit before managing to nudge back up into its former upper trading range (which starts above 1% up from where we are now). Nasdaq got a little oversold, but not profoundly, before bouncing. S & P gave up a whisper less than 10% at its Monday low, but that was it. Sentiment/technical extremes relieved but not wrung out entirely. Nothing says Monday's low can't be THE LOW for this skid, but if that's the case doesn't seem we pulled the slingshot back far enough to make for an up-and-away run to/above the old highs. Traction today in cyclical groups – equal-weight consumer discretionary and EQ industrials both up a third of a percent. This is the seesaw on many days – either mega-growth tech or real-economy cyclicals have the ball. Not a true zero-sum relationship but still. This despite more noise on rising case counts/bracing for a potential fall surge. Sad little bounce in banks. Interesting Tesla weak after battery-day hype overshot reality on a day when many "disruption" names are working. Snowflake , Zoom Video , Peloton , etc. Tesla is, as ever, its own equity weather system, driven by flows of hot air. Apple back under $110, the tussle in this stock getting intense under the stock's 50-day average. Nike shows what happens when a category leader gets direct-to-consumer rolling in a big way. Saw similar revaluation upward with Starbucks , Target , Chipotle . Stock's quite rich right now – 35x 2022 earnings - but this market is fully willing to pay up for digital momentum once it gets above a critical-mass level. U.S. dollar index rallying to a two-month high, running against a pretty entrenched bearish consensus, undercutting gold, silver along the way. At the margin it reflects tightening financial conditions though coming with Chinese yuan also strong doesn't speak as directly to global growth issues. Market breadth is pretty weak, like 35/65 up/down, could help generate some more extreme oversold readings that would make a dip-buy appear a better bet at some point. Credit is a bit iffy, high-yield spreads leaking a bit wider, nothing too worrisome yet. VIX bumpy but not much of a lift there, range-bound above 25 still.

Traders work during the opening bell at the New York Stock Exchange (NYSE) on March 19, 2020 at Wall Street in New York City. - US stocks open mixed, Dow -0.4%, Nasdaq +0.1% (Photo by Johannes EISELE / AFP) (Photo by JOHANNES EISELE/AFP via Getty Images)

JOHANNES EISELE | AFP | Getty Images

This is the daily notebook of Mike Santoli, CNBC's senior markets commentator, with ideas about trends, stocks and market statistics.

(This story is for CNBC Pro subscribers only.)

Corrections are processes, and usually leave everyone a bit off balance as they move along. Bounces alternating with backslides, one day the market seems in the clear, the next back in the soup.
Fitful, inconclusive trading today, Nasdaq digesting its bounce and the S&P 500 wavering a bit before managing to nudge back up into its former upper trading range (which starts above 1% up from where we are now).