Futures flattish. Would love to see couple days of nothing but earnings season and tax proposals continue.
Gappers- IRBT, WYNN, TSS, TWTR, ANTM, TEL, EW to upside.
X, CREE, COF, DFS, ILMN, UTHR, ULTI, STX to the downside.
We are sure we missed a few but will cover them after the market closes.
We will have our own op-ed on all this tax proposal nonsense later tonight.
Another gap to the upside. Only issue was the tired close of financials but that’s all. Nothing wrong with being a little overbought.
Good to see strong reactions out of names like MCD and CAT. Those 2 names were about 100 Dow points. Lots more earnings to come out but this 2 day move sets up a ton of stocks for entry. Be focused…especially as more earnings are reported.
Lastly, when the market can pull back in a shallow fashion for over 8 weeks and get most of it back in 2 days…THAT IS STRENGTH. Keep that in mind.
We will let that stand on its own.
Don’t you love socialists. Whine and complain about the rich and the successful. Whine and complain about those that make “too much” money. They whine and complain until they are making the cheese. President Obama is not immune to socialistic capitalism.
Sorry about no closing comments yesterday.
Go figure…a French preliminary election juices the market. The case is being made that if the far right candidate won, France leaves the EU…which could lead to who knows what. When the market realized there was no chance of winning on May 7, everything is great again. At least the market thought so.
So…we report the news:
Nasdaq and NDX break to new highs.
The new high list expands markedly.
The financials, maybe, possibly, could be…put in a firm low for now. Not leading but no longer breaking another level…yet.
Countries like France and Germany into new high ground. Massive debt, deficits, high unemployment, tepid GDP do not matter. Why? Negative rates and printing of money continues.
The Dow and S&P hold support and possibly “turn the corner!” Possibly!
The weak Transports back above the 50 day.
The Russell 2000 is back up into its 19 week trading range.
So…a lot happened yesterday because the pullback had been shallow. Just keep in mind this is no longer an A-Z market. We are now in the midst of earnings and will get a much better idea by the reactions. We also have the Trump tax plan tomorrow. We do not believe there is a chance of a government shutdown but then again, we likes the Knicks this year.
We do not rationalize why. We are of the belief that it’s not the news. It’s how the market reacts to the news. But since it is news, here is what is happening to cause the markets to jack to the upside this morning.
The supposed pro EU, pro immigration “centrist” in France will now be in a runoff with the anti-immigration, anti-EU “extremist!” Since the centrist is 20 points ahead in the polls with a May 7th runoff, the chalk is an easy win. A win basically takes a “FREXIT” off the table as well as the potential for an EU disintegration in which the “extremist” wanted. This has caused European assets to go topside which in turn is causing the rest of the world to gap up a little over 1% this morning.
On top of this news, do not forget that recently, we have seen plunging oil prices, mortgage rates back under 4% and this Wednesday, a tax reform proposal…all potentially bullish stuff.
Is 1% important? In our work, could be.
We say this because the Nasdaq/Ndx will break to new highs off the gap. Technically, very strong.
Other major indices will show strong support off the lows and back above moving averages…which in turn positions them to move out also. Remember, the 9 week pullback for the indices has been shallow though some areas have been hit harder.
So that be the deal…a chance for a 9 week topside move of world assets. Of course, recently, all strong opens have been sold into. It is a long day. But at the open, strong stuff out of the box.