Stocks Pull Back In Early Trading

The market got a boost near the open on a better than expected economic report and falling oil prices, but it has since traded back into negative territory.

The April durable goods report fell -0.5%, but rose +2.5% ex-Transportation. Both figures were better than expectations. Also, oil fell below $126 this morning before rebounding back near $129. So far, oil has pulled back roughly 5% from its highs.

There were some good earnings reports in the specialty retail sector, which is helping lift the retail index. Homebuilders are also bouncing, but financials are showing considerable weakness and it looks difficult for the market to bounce with financials this weak.

The transportation index is getting a lift from a big upgrade on UPS from Hold to Buy at Merrill Lynch.

Asian markets were mixed to lower overnight, while the dollar is up again vs. the Yen and Euro. The 10-year yield is bouncing to 3.99%, its highest level since Jan. 2. I still believe the positive slope of the yield curve is a bullish prediction for the year ahead.