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Banks Continue to Lift Market

John Darsie

The S&P made new highs once again during Tuesday's session, once again led by the banks. The volume in the S&P 500 ETF (SPY) was the lowest for a full-day session since late 2010. This remains a very stock specific tape, but the trend in the indices remains firmly bullish. The Dow and S&P finished the day with gains, while the Nasdaq slumped to a loss thanks to weakness in Apple (AAPL). Tech continues to lag, but the financials have been able to take the leadership mantle.

Goldman Sachs (GS) and JP Morgan (JPM) have re-emerged as the leading bank stocks, perhaps demonstrating that quality ultimately shines through over the long-term. Last week, though, we noted that two secondary names in the sector that had provided good upside over the past few months were starting to perk up again: Bank of America (BAC) and Citigroup (NYSE:C). BAC and C led the group higher today with gains of 3.25% and 2.78%, respectively. GS and JPM both rallied around 1%.

The 3-D printing sector saw significant weakness today that accelerated in the the afternoon. The biggest name in the group 3-D Systems (DDD) dropped 6.42%, breaking down out of an upper level range and closing below both its 8- and 21-day moving averages. Stratasys (SSYS) fell 6.37%, plummeting out of an upper level bearish ascending channel that was highlighted on Off the Charts and in Friday's Morning Call. The newest IPO in the group, ExOne (XONE), dropped even more sharply, losing 8.55% on the day after a monster start to its public life. After a harsh sell-off in DDD and SSYS on January 28th, the group has been on our radar for follow-on weakness, and today's action could be the start of a bigger correction in these highly valued stocks.

Many traders were watching Apple (AAPL) today due to CEO Tim Cook's keynote address at Goldman. Curiosity was high heading into the address after AAPL had been able to rally into its earnings gap over the past few sessions, but the much-maligned AAPL executive didn't bring any game changers to the table. AAPL finished the day down 2.51%, which from a technical perspective was not surprising given that the stock had rallied into short-term resistance around $483. The stock still has a lot of prove on a macro level and would need to break above the multi-month downtrend to get more compelling.

*DISCLOSURES: Evan Lazarus is short NFLX