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Market check: Stocks rise as investors eye earnings

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Yahoo Finance's Jared Blikre breaks down how markets opened on Wednesday.

Video Transcript

EMILY MCCORMICK: Markets have been open about eight minutes now and stocks are trading slightly higher as investors eye that early set of earnings results this morning. For a deeper dive into today's early market action we're heading over to Yahoo Finance's Jared Blikre for more. Jared.

JARED BLIKRE: That's right, Emily. I was just taking a look at the bond market. We'll get to stocks in a second we just had the open.

But on the YFI interactive I'm looking at the 10-year, T-note yield, which has just been screaming higher over the last six weeks. This is a year-to-date chart and from March going forward it has simply been on a tear. Now you compare that with what has been happening in the equities market. Now you can go all the way up to for instance, the Dow when we have the yield curve climbing you would expect that to favor value stocks a little bit more. Simply really not what's happening if you take a look at what's happening in the Dow and also some of the sector action.

So my connection is a little bit slow here. Let's see if I can get this up to snuff. There we go. So here's a year-to-date chart of the Dow. And during the same time period you can see stocks up marginally but not as much as you might would have thought given the fact that the Dow is more heavily weighted with some of these value names, that would be energy and also some of the financial stocks. And we'll get to JPMorgan in just a second check out what it's doing.

But here we see energy is in the leading sector today, 1%. But let's take a look at what's happened over the last month in terms of the sector action. You can see the leading sector is actually XLP, that's staples.

That's in the upper left. That's up 10%. That's followed by materials utilities, health care, real estate, discretionary, all of those are outperforming. But you take a look at to the downside, everything's still in the green.

Financials, the underperforming sector that has to do not only are yields climbing but the curve is also contracting. It's contracting a bit so that is weighing on the financial stocks. Energy also not the outperformer it has been since the beginning of the year but energy also up about what? 30, 35% from the start of the year.

All in all, it's been pretty interesting to watch what has been working over the last four to six weeks. Again, this is on a one-month basis. KWEB in the upper left that is a Chinese internet ETF. However, we know how beaten down that sector is, you might call that a dead cow bounce-- dead cat bounce.

Following that we have a low volatility ETF-- biotech, Ark Innovation Fund, cannabis all of those are outperforming but we're not seeing the outperformance by the regional banks here that we see to the downside. That's correct. Homebuilders as mortgage rates rise not doing as well.

Transports not doing as well. They were just about at a record high only a couple of weeks ago. So there is a little bit of skittishness in this market. As we begin earnings season as you might expect, not going to be easy here everybody trying to figure out what the Fed is going to do come May.

- Jared, do you think this green on the screen is short lived. Don't these retail investors need to-- to sell some of their stocks to pay taxes?

JARED BLIKRE: Yeah, that's an excellent point. And Goldman Sachs writing about this earlier. That is a headwind for stocks going into tax day. So you would expect that to turn into a little bit of a tailwind once that releases or once that lifts from the market after tax day. So we're talking about one week from now. Now here's what's happened over the last month. We see the meme stocks here really on a tear-- GameStop up 56%, AMC up 21% well off their highs.

But check out what's been happening this week. Let's go to a five-day basis not quite as much red here seeing AMC down 15%, GameStop down 7%. You could say, well, if you had some holdovers there and they had to pay some capital gains on other taxes or just had a really big tax bill, they might be selling some of those stocks.

Also noting, Goldman Sachs also noted that crypto-- we'll take a quick look at Bitcoin here, crypto has been leading equities over the last month or so. So really interesting to see that. Bitcoin looks like right around $40,000, kind of a critical level. But I will say, if you take a look at the year-to-date chart, still in an uptrend here although it is at the very bottom of that trading range, guys.