Founded in 2000, MarketAxess is a leading electronic fixed-income trading platform that connects broker/dealers and institutional investors. The company is primarily focused on credit based fixed income securities with its main trading products being US investment-grade and high-yield bonds, Eurobonds, and Emerging Market corporate debt. Recently the company has expanded more aggressively into Treasuries and municipal bonds with the acquisitions of LiquidityEdge and MuniBrokers in 2019 and 2021, respectively. The company also provides pre- and post-trade services with its acquisition of Regulatory Reporting Hub from Deutsche Börse Group in 2020 adding to its product offerings.

The calendar turned to September, historically the worst month of the year, and all of a sudden things go to heck and in a handbasket. Yet again, the largest drag on the stock market was the heavily weighted Information Technology (XLK -4.6%) sector. The group was once again dragged down by once-beloved semiconductor stocks, with the major semi indices getting pulverized by 7% to 8%. Since July 17, the iShares Semiconductor ETF (SOXX) and the VanEck Vectors Semi ETF (SMH) have dropped at least 6% on three different days. All three of those days featured very heavy volume, a clear sign of institutional distribution. We started to see distribution on the semis and the Nasdaq 100 (QQQ) back in the middle/latter part of July. Most of the major semi stocks have lost their 50-day average for the second time since late July, while a handful are breaking below their more-important 200-day averages and are closing in on their initial lows from early August. The QQQ cratered 3.2%, broke down out of a developing bull flag, and closed near a 38.2% retracement of the rally since the August 5 intraday low. We did see a minor 5/13 exponential moving average crossover sell signal, reversing the buy signal from August 15. A 50% retracement of the rally comes in at 454 and a 61.8% give-back lies at 447. The S&P 500 lost 2.1% as the index bounced off its 50-day average late in the day. A 38.2% retrace of its rally is at 5,448 while a 50% give-back targets 5,386. There was a 38% spike in the volatility index (VIX) and it is now just above 20. We have a feeling the month will bring more of the same. (Mark Arbeter, CMT)

MarketAxess Holdings operates a global electronic trading platform, primarily for corporate bonds and other fixed-income instruments. The company enables institutional investors and broker-dealers to anonymously trade securities and offers clearing and market data services. The company has approximately 864 employees and was added to the S&P 500 in 2019.

As of this writing, major indices are getting closer and closer to their all-time highs (ATHs) from July 10 and July 16 (S&P 500 and S&P 400, respectively). The only major index that has bounced enough to reclaim ATH territory is the NYSE Composite, probably due to the minor 5.6% pullback the index saw in the second half of July and early August. The S&P 500 (SPX) is within 1% of its July 16 all-time closing high of 5,667.20 and remains on its 'V' shaped formation and trajectory. The Chande Trend Meter is back up to 83%, indicating a strong and strengthening trend; the Vortex Indicator is close to bullish territory; the 14-day Relative Strength index is back above the midline 50% level; the daily MACD is back in positive territory; and the 21-day rate-of-change has cycled back into bullish territory after dropping into negative territory at the start of August. Some 75% of SPX stocks are above their key 200-day average, while 73% (up from 44% on August 5) are above their 50-day. More impressive, the more-concentrated S&P 100 (OEX) is showing 83% of its stocks above their 200-day average, up from a recent 65%. Both the SPX and OEX advance-decline (AD) lines have surged to ATHs prior to price; historically, that has been very bullish for at least the intermediate-term period. The Nasdaq 100 (QQQ) is 4.5% from its ATH near 503 and its AD line has posted an ATH prior to price. Some 71% of QQQ issues are above their 200-day, up from 44% just 10 days ago, while the percentage above the 50-day has jumped to 61% from 29% on August 7.