MV Weather Report: A Second Spring for the Bulls?
Rain or shine, we review the day's biggest stock stories.
The S&P 500 rallied 2.63%, to 910. Though we saw a broad market lift, the leaders were tech and the financials, led by JPMorgan (JPM), Wells Fargo (WFC) and PNC Financial (PNC). Bank of America (BAC) stuck out as the only weak link; this stock has had trouble gaining momentum since the big equity offering last week.
Tech was extremely strong today: Morgan Stanley upgraded Apple (AAPL), saying that it Steve Jobs' brainchild remains the dominant leader in the mobile-phone space. Despite the obviousness of this observation, the market still loved this news: Shares of Apple rallied 6.76%. Other tech darlings rode Apple's coattails: Google (GOOG), Research in Motion (RIMM), and Amazon (AMZN) were all up.
I think it's interesting that tech led the tape today. Remember, these stocks were the first to rally back in March, and also the first to pull back in May. Does tech's strength signal that the market is about the move higher?
Today on the Buzz and Banter, Fil Zucchi had some comments about this rip-roaring rally:
"I am noticing the Buzz & Banter being as quiet as it has been in a long while, and, in my humble opinion, with good reason. It has been a while since we have seen a plus 2.5% day as meaningless as this. Volume is virtually non-existent, and there's nothing remotely actionable to trade. Hoofy may argue that going up on no news is indeed good news. Boo would retort that buying without a reason is a blueprint to lose money.
"What sticks out to me is the relentless deterioration of the dollar despite ever rising long term treasury yields. As I suggested before, I read this as a vote of no confidence for where the U.S. financial system is heading."
Fil did a nice job of presenting both side of the trade. After the slight pause/pullback we've had, some are starting to get bullish again.
Professor David Waggoner also gave his take, using Elliot Wave analysis:
"This is a chart I produced over the weekend. The strong bounce this morning favors that the 1-2-3 thesis and targets 965 over the coming week. It should be a 5-wave move. "
Click here to enlarge.
Tomorrow will be an important day for the market. It's very possible that we can test last week's high of 924; if it gets broken, we could be on our way to Professor Waggoner's target.
Have a great night, Minyans!
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