Tech Earnings Weighing On An Overbought Market

We are getting into the thick of earnings season, and company results can color the tape on any given day. This morning, a handful of reports in the tech sector are causing some selling pressure.

IBM is lower after matching expectations and citing a weaker spending environment. YHOO gapped down by more than -10% after slightly missing both top and bottom line expectations. And Motorola (MOT) gave flat Q2 sales guidance, but it looks like the stock has bottomed. Also, RIMM reported an outage in its BlackBerry handsets last night, but it doesn't seem to be weighing on the stock as of now.

Away from the tech sector, things get better. JP Morgan (JPM) reported much better than expected results and announced a $10 billion buyback. The stock gapped to a new high this morning, and is helping the broker group bounce back as well. UTX also reported solid results, beating consensus estimates.

In other markets, the dollar is lower again today vs. the Yen and Euro. Oil is trading slightly higher, around $63.30. And the 10-year yield is lower at 4.65%.

Given that the Dow has been up for 13 of the last 14 sessions, this morning's profit taking could have been a lot more severe. It's still early, but the selling pressure doesn't feel very intense. I would like to see the market chop around for a few days while working off its overbought condition.