Yellen Speaks, Fintech Sleeps

March 3rd & Week End Review KBW NASDAQ Fintech Index KFTX

Nasdaq KFTX Fintech Index
Federal Reserve Chairwoman Janet Yellen spoke today and the markets responded with………..a nap. So many hints (rate hike), so little time (under 2 weeks) until the March 15th FOMC meeting. Rate hike pretty much assured with a 90% probability and, again, the market responded with…………..a nap. Yawn.

With that lead in over, the KFTX fintech index lifted a “massive” 1.43 points (+0.12%) to finish the week at 1147.61. In other words, a sleepy Friday with little interest or movement. So, let’s check the 50 stocks in the KFTX fintech index to find any that moved 2 points and/or 3% today.

ACIW  -.80  (22.01)  -3.51%
GPN  +2.34  (80.61)  +3.00%
WETF  -.31  (9.22)  -3.25%

That’s it. Told you it was sleepy. Today’s advance/decline showed 34 stocks up with 16 down. So, Friday is in the books.

Markets, in general, experienced another week of hitting new highs but seems nobody bothered to tell the KFTX fintech index. That 50 stock sector managed to LOSE 3.4 points (-0.03%) on the week and closed at 1147.61. Lets peek at the issues that had a change of  3% on the week.

ACIW  (22.01)  +7.88%
BOFI  (29.29)  -6.33%
ENV  (30.85)  -4.29%
LC  (5.13)  -7.90%
TREE  (119.10)  -3.00%
WEX  (109.08)  -3.61%

So, short list and even the week’s advance/decline was a standoff with 24 stocks up and 26 down. Not a real strong showing.

Now where will this new week take us? I am now on record of saying……..down. I believe the last few weeks have seen tons of money poured into index ETF’s which in turn put money into a few highly liquid issue like Google, Alphabet, etc and, in fact, fewer and fewer issues are driving the market “headline indexes” to the highs we have seen. Not unlike the “nifty fifty” of years ago when institutions HAD to be in those few stocks to beat the market. It did not end well and most of those “nifty fifty” names are on gravestones in the stock cemetery.

Hedge, take profits, lighten up or……..go on Spring Break. But, this week may be the start of a significant correction (you remember those, right?). CAUTION. Have a good week.
By Bill Taylor-CEO, FintekNews & CIO, TLC Capital Group