Has The Infrastructure Bill Stolen The Inflation Spotlight?
Michele Schneider | Jun 27, 2021 04:29AM ET
The stock market steadied itself last week, as the major indices cleared or headed to new highs. Additionally, the media slowed its aggressive inflation stance and looked to be shifting into the next trend as the newly passed infrastructure bill adds a chunk of areas to talk about.
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However, whether the media places inflation in the spotlight or moves on to higher trending topics, we should keep it on the sidelines, for one big question still needs to be answered.
How do we pay for this new 1.2 trillion-dollar bill over 8 years? The current administration proposed a tax raise on corporations which ultimately failed to hold ground.
Without any new ideas that either party can agree on, it looks as though taking on more debt through auctioned government bonds will likely pay much of the bill.
With that said, to keep investors excited enough to take on U.S debt, the country will need to keep its strong market outlook and progress.
Therefore, we have been watching the transportation sector—iShares Transportation Average ETF (NYSE:IYT)—as it shows the demand side of the market and can signal fading market momentum if it begins to trend lower.
At the current price levels, IYT needs to hold over recent support at $254. However, if IYT breaks down, stay cautious as the indices could have trouble holding highs.
h2 ETF Summary/h2- S&P 500 (SPY) New all-time highs.
- Russell 2000 (IWM) 233.64 next resistance level.
- Dow (DIA) Watching for a second close over the 50-DMA at 342.27.
- NASDAQ (QQQ) 342.80 support.
- KRE (Regional Banks) 63.63 support. 68 choppy area.
- SMH (Semiconductors) 257.54 resistance.
- IYT (Transportation) 254.65 support.
- IBB (Biotechnology) Needs to hold 159 level. 163.63 resistance to clear.
- XRT (Retail) Watching to hold 97.
- Junk Bonds (JNK) 109.65 now support.
- XLU (Utilities) 63.25 new support.
- SLV (Silver) 23.84 support.
- VBK (Small Cap Growth ETF) 292.96 next resistance level.
- UGA (US Gas Fund) 35.70 support.
- TLT (iShares 20+ Year Treasuries) 140 next support level.
- USD (Dollar) Watching to hold the 200-DMA at 91.49.
- LIT (Lithium) 73 next resistance.
- DBA (Agriculture) 17.67 support.
- GLD (Gold Trust) Like this to hold over 166 with 164.87 support.
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