How the Delta Variant Peak Will Impact the Stock Market

NYSE: SPY | SPDR S&P 500 ETF Trust News, Ratings, and Charts

SPY – Last week, I discussed why the typical classification system of dividing stocks into growth and value buckets was not sufficient for the current S&P 500 (SPY) environment. Instead, a more accurate system would be dividing stocks into 3 categories –growth, value, and reflation. The tricky part is that right now, reflation stocks have the most earnings growth. And, they have the cheapest valuations. This is certainly a unique development which is fitting given that we are living through a very unique period of time. In this week’s commentary, I want to discuss the changing fortunes of these various groups, when the market environment will get friendlier for small and mid caps stocks and some glimmers of optimism in the coronavirus situation. Read on below to find out more….

(Please enjoy this updated version of my weekly commentary published September 13, 2021 from the POWR Growth newsletter).

First, a programming note:

Yes, this commentary is coming to you on Monday rather than on a Wednesday. The reason is that we are launching the POWR Stocks Under $10 service which I will also be leading and that commentary will be on Thursday. So this will give us some breathing room between the two especially as many of you will be subscribing to both.

The POWR Stocks Under $10 is going to specialize in low-priced stocks. Most of the stocks in this universe will be poor investments but at the same time, the best-performing stocks in the market will also emerge from this group.

Thus, we will be using a variety of quantitative and qualitative tools to dig up these names by zooming in on stocks that are inflection points in terms of their earnings, revenue, and overall prospects.

If you are not already a POWR Platinum member (meaning someone who has access to ALL of our trading services including the POWR Growth and POWR Stocks Under $10 that launched yesterday) then please reach out to our team at the email address below to request a free 30 day trial.

[email protected]

This will give you 30 days full access to all our services…all our best insights…all our best trades. Again, just email the team at the email address above with the subject line of “30 day free Platinum trial”.

Now, back to the market commentary:

Let’s start with our usual look at the one-month, hourly chart of the S&P 500:

Since last Wednesday, stocks have weakened further. In fact, we’ve given back more than half of the advance that begun in mid-August. In terms of market leadership, we’re seeing reflation stocks leading higher, while growth stocks have been the weakest. Essentially, it’s been a reversal of what happened during August.

Still a Muddled Market

The overall takeaway is that this remains a messy, muddled market. The market’s ascent is masking a vicious rotation going on under the surface. We haven’t had nice, trending conditions since November of last year which lasted till mid-February. Since then, different parts of the market have been punished and sold off.

The good news is that this is a much healthier way of resolving overbought conditions to digest the huge gains from last year rather than a correction which typically tends to happen.

In terms of our portfolio, we are up about 11%, while the Russell 2000 is essentially flat since the portfolio’s inception. We will continue to remain agile with our positioning and look for singles and doubles rather than home runs.

One Glimmer of Optimism

I do want to point out one development which I want to take advantage of – it seems likely that the Delta variant has peaked. The seven-day moving average is now about 6% below its peak, and the hardest-hit states like Florida and Texas are down much lower.

This also tracks with the experience of other countries which dealt with the Delta variant which saw a peak after about 2 months. It also led to a surge in vaccinations, and the country seems to be about 4 months away from reaching “herd immunity” in terms of vaccinations + prior infections.

The rise in the delta variant has certainly led to profit-taking in many travel stocks, but this is an opportunity for us to take advantage of the dip.

What To Do Next?

The POWR Growth portfolio was launched in early April and is off to a fantastic start.

What is the secret to success?

The portfolio gets most of its fresh picks from the Top 10 Growth Stocks strategy which has stellar +46.42% annual returns.

If you would like to see the current portfolio of growth stocks, and be alerted to our next timely trades, then consider starting a 30 day trial by clicking the link below.

About POWR Growth newsletter & 30 Day Trial

All the Best!

Jaimini Desai
Chief Growth Strategist, StockNews
Editor, POWR Growth Newsletter


SPY shares were trading at $443.83 per share on Tuesday afternoon, down $2.75 (-0.62%). Year-to-date, SPY has gained 19.49%, versus a % rise in the benchmark S&P 500 index during the same period.


About the Author: Jaimini Desai


Jaimini Desai has been a financial writer and reporter for nearly a decade. His goal is to help readers identify risks and opportunities in the markets. He is the Chief Growth Strategist for StockNews.com and the editor of POWR Growth newsletter. Learn more about Jaimini’s background, along with links to his most recent articles. More...


More Resources for the Stocks in this Article

TickerPOWR RatingIndustry RankRank in Industry
SPYGet RatingGet RatingGet Rating
.INXGet RatingGet RatingGet Rating
DIAGet RatingGet RatingGet Rating
IWMGet RatingGet RatingGet Rating
QQQGet RatingGet RatingGet Rating

Most Popular Stories on StockNews.com


:  |  News, Ratings, and Charts

2022 Stock Market Outlook

The stock market (SPY) has continued on a bullish path in 2021. Will that continue in 2022? And what could happen to awaken the bear market from hibernation? 40 year investment veteran Steve Reitmeister explores this and more in this early edition of his 2022 Stock Market Outlook. Read on for full details below...

:  |  News, Ratings, and Charts

How Recent Bearish Sentiment Will Impact the Stock Market

Last week, the S&P 500 (SPY) fell during a short trading week. Multiple factors were weighing on investor sentiment. First was September's history for being a weaker month for stock performance. In addition, the previous week's August payrolls miss seemed to linger on investors' minds due to concerns that the delta variant of COVID was slowing the rebound in the economy. The real estate sector led declines as long-term interest rates increased. Consumer staples and utility stocks performed the best. In terms of market cap, the small-cap Russell 2000 Index underperformed the market after two strong weeks of outperforming the larger benchmarks. Growth stocks also outperformed Value stocks. I’ll discuss this and more below…

:  |  News, Ratings, and Charts

How to Turn Low Priced Stocks into BIG Winners?

Some investors are into growth stocks...some prefer value stocks while others are into momentum, income, chart patterns, insider trading and more. But one area that most investors agree upon is the great appeal in buying low priced stocks. Like those under $10 given the potential that prices soar and you easily beat the stock market (SPY). Read on to discover our brand new strategy for selecting low priced stocks that has led to a surprising +62.88% average annual return. Get the rest below...

:  |  News, Ratings, and Charts

3 Growth Stocks You Can Buy at a Reasonable Price

Even with growth stocks falling last week, investors are still pouring money into companies with strong growth potential. When you add in a value component, you get the best of both worlds. That's why investors should consider growth at a reasonable price stocks such as Westlake Chemical Corporation (WLK), ManpowerGroup (MAN), AutoNation, Inc. (AN).

:  |  News, Ratings, and Charts

How to Turn Low Priced Stocks into BIG Winners?

Some investors are into growth stocks...some prefer value stocks while others are into momentum, income, chart patterns, insider trading and more. But one area that most investors agree upon is the great appeal in buying low priced stocks. Like those under $10 given the potential that prices soar and you easily beat the stock market (SPY). Read on to discover our brand new strategy for selecting low priced stocks that has led to a surprising +62.88% average annual return. Get the rest below...

Read More Stories

More SPDR S&P 500 ETF Trust (SPY) News View All

Event/Date Symbol News Detail Start Price End Price Change POWR Rating
Loading, please wait...
View All SPY News