If the first trading session of the month is an indicator, then it looks like the market will show a lot more spunk than it did in January. Interestingly, there were 75 stocks at new 52-week highs on the NY Stock Exchange and only 37 new lows, but the NASDAQ saw 23 new highs versus 96 new lows, yet it was the only major index to finish higher.
There’s a good chance that the momentum will carry-over into tomorrow after Alphabet (GOOG) beat earnings consensus by $0.57 after the close. There are so many oversold names, but there’s a lot of confusion over the economy and how well the Fed will be able to manage the removal of accommodation. With the jobs report looming large for Friday, there will be more angst than usual. Hang in there; take lumps where you have to, as there are great opportunities out there. I love the action in Cracker Barrel (CBRL) and Auto Zone (AZO), and a lot of tech names as good trades, including Workday (WDAY).
Message from Bonds
Federal Reserve Vice Chairman Stanley Fischer acknowledged the global equity market rut, admitting it could negatively impact the U.S. economy. Of course, the bigger question is whether it is a proxy for the U.S. economy is. The ten-year yield ebbs toward 1.85.
Market internals have improved slightly. Once again, new highs on the NYSE underscore the move to quality, but NASD numbers fared markedly better than a couple weeks ago.
Breadth |
New Highs |
New Lows |
NYSE |
75 |
37 |
NASD |
23 |
96 |
Technical View
The intraday reversal in major indices was very impressive, even if rebounds faded right before the closing bell. The Dow nestled right up to a key breakout point of 16, 500 before slipping, and the NASDAQ actually eked out a gain. It is very positive stuff; the market must display this kind of spunk.
Barbie to the Rescue
So, Mattel is making its Barbie line more inclusive in more ways than one, just as we are entering a new presidential election cycle that is divisive as ever. It’s all about the have and the have-nots, even a debate on what a real conservative is or is not; I find it ridiculous. I am hoping we come out of this as a United States of America because the clock is ticking fast.
Solutions that assuage or stoke anger make the situation more problematic…all the while the clock is ticking.
Moreover, it can’t be business as usual in Washington anymore. I hope a major majority consensus coalesce around this truth. (By the way, Mattel (MAT) posted an earnings beat after the bell and rallied up 6%.)