We will ignore all the negatives we have been reporting to you on the markets for today. For today, it is time to accentuate the positives. And there are positives. Regardless of the 60% of the market that just ain’t working, the positives are:
For starters, regardless of China…regardless of Greece…regardless of the slowdown in sales and earnings, the major indices have hardly budged from their highs. In fact, the recent drop was approximately a nominal 5%. This is a tiptoe through the tulips. Potentially, this could cause sellers to stop selling as they recognize under the supposed worst of news, that’s all there is.
On top of this, there continues to be that 40% of the market that remains in good shape…and to add a little fuel to the fire, a couple of new areas are showing up and a good amount of breakouts occurred on Monday. The groups include retail-auto parts, retail-drug stores, cruise lines, a few airlines and restaurants. We also think it important that the almighty Apple undercut support but quickly recovered shaking out some late sellers. We do believe Apple is probably the most important bellwether markets have ever seen.
Biotechs continue to lead the pack but are mixed.
Financials, while losing some of their relative bid, are still hanging in there but earnings time. Speaking of earnings, remember, it’s not the news, it’s how things react to the news.
New highs did pick up some on Monday. This is where you find leadership.
Major indices are back into the nauseating trading range we have talked about for quite a while. Yippee!
Greece and China still remain front so pay attention…especially China. Greece will get swept under the rug again but if China continues to sell off, will not be thrilling.
Omega Advisors Chair and CEO Leon Cooperman told FOX Business Network’s Neil Cavuto that he doesn’t expect a bear market anytime soon – and he sees no signs that the U.S. is headed for a recession.
“We don’t see any signs of recession,” Cooperman said. “Employment is rising by over 200,000 a month, initial claims for unemployment benefits are running like 270,000 a month, which is a low level.”
Chart courtesy of StockCharts.com