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The market rebounded during July, helped by a relatively strong earnings season and reassuring messages from the Fed regarding the economic outlook. According to the latest Investor Movement Index (IMX), TD Ameritrade clients reduced their exposure to equity markets.
Net Buys In A Selling Environment
This is how the IMX works: when the index’s score surges, it means investors' recent past activity has leaned toward a bullish stance; conversely, when the score declines, investors' recent past activity has tended towards bearishness.
Over July, the IMX declined by 6.2 percent, to 4.69, not only because TD Ameritrade clients were net equity sellers over the month, but also due to “lower volatility relative to the overall market of several widely held names” like Apple Inc. (NASDAQ: AAPL), Facebook Inc (NASDAQ: FB) and Bank of America Corp (NYSE: BAC).
TD Ameritrade’s Managing Director of Trading, Nicole Sherrod, shared a more detailed look into the index, pointing out a few names that were net buys in July, despite the overall selling seen in the market.
Ahead of their earnings reports, Amazon.com, Inc. (NASDAQ: AMZN) and Facebook were net buys. And bulls got their reward, as both companies beat the Street’s consensus estimates, taking their stocks to record highs.
"I think the clients are being smart in that they saw many stocks at or near 52-week highs and took some profits," said TD Ameritrade Chief Market Strategist JJ Kinahan. "I think they did rotate in to other names particularly some of the financials that pay decent dividends. That way they were also playing for yield as well as capital increase."
Also popular in July were dividend-paying companies likeWells Fargo & Co (NYSE: WFC), Barclays PLC (ADR) (NYSE:BCS), Bank of America and Ford Motor Company (NYSE: F).
Two more popular net buys in July were Netflix, Inc. (NASDAQ: NFLX) and Tesla Motors Inc (NASDAQ: TSLA).
Posted-In: IMX Nicole Sherrod TD AmeritradeNews Markets Movers Trading Ideas
© 2016 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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