COMMERCIAL VEHICLE AND TRUCK GROUP LEADS INDUSTRIAL SECTOR HIGHER -- DEERE, PACCAR, AND CATERPILLAR TEST 200-DAY AVERAGES -- GATX CLEARS ITS 200-DAY LINE TO LEAD TRANSPORTATION GROUP -- SO HAS JB HUNT
LEAD INDUSTRIALS HIGHER... Economically-sensitive industrial stocks continue to show new strength. A leading industrial group is the Dow Jones US Commerical Vehicles and Trucks Index ($DJUSHR). Chart 1 shows that index climbing more than 2% today to a new three month high. It includes big percentage gainers like Joy Global (JOY) and Navistar (NAV). Three stocks in that group, however, have risen above their 200-day averages, or are close to doing so.
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Chart 1
DEERE, PACCAR, AND CATERPILLAR TEST 200-DAY LINES... Chart 2 shows Deere (DE) trading above its 200-day average in today's trading. Its relative strength line (top of chart) has been rising since November. Chart 3 shows PACCAR (PCAR) sitting right on its 200-day line. It's one of the biggest percentage gainers in the Nasdaq 100. Chart 4 shows Caterpillar (CAT) nearing its 200-day line. Those last two stocks also have rising relative strength lines. CAT is the biggest percentage gainer in the Dow today. Those stocks are helping keep the economically-sensitive Industrials SPDR (XLI) above its 200-day moving average.
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Chart 2
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Chart 3
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Chart 4
GATX CLEARS 200-DAY LINE... The Dow Jones Transportation Index has moved into positive territory for the year and is starting to attract more attention. Chart 5 shows GATX Corp (GMT) gaining more than 4% today to lead the transportation index higher. It is also trading above its 200-day average for the first time in nearly a year. Its relative strength ratio (top of chart) has reached a five-month high. GATX is a leader in railcar leasing serving the North America rail market. Yesterday's message showed a couple of trucking stocks trading above their 200-day averages. I mentioned that J.B. Hunt (JBHT) might be next. Chart 6 shows that trucking leader trading slightly above its 200-day line. Its relative strength line shows a big jump starting in January.
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Chart 5
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Chart 6
NYSE PERCENT OF STOCKS ABOVE 50-DAY AVERAGE NEARS NOVEMBER HIGH ... A lot of attention is now being paid to stocks testing or exceeding their moving average lines. My February 20 message had a headline suggesting that the percent of NYSE stocks trading above their 50- and 200-day moving averages might be bottoming. Let's take another look. The blue line in Chart 7 shows the % of NYSE stocks above their 50-day lines. Since February 20, that line has nearly doubled from 38% to 73%. That reflects the short-term improvement that's taken place over the last month in major stock indexes. That line, however, is nearing an important test of its early November peak at 74%. What it does near that resistance barrier will help determine if the short-term rally has more staying power. Chart 8 shows the % of NYSE stocks over their 200-day lines. It has risen from 23% to 34% since we last looked at it. That means that roughly a third of big board stocks are back in uptrends. While that's encouraging, it's not conclusive enough to signal a major bottom. For that to happen, the red line would have to clear its fourth quarter high at 41%. We'll be watching.
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Chart 7
