Can't Keep A Good Market Down

Once again, the market opened lower, but in the first hour of trading it has climbed back into positive territory. Of course, yesterday the market sold off into the close, so we'll have to see if this early strength sticks. But it sure seems like its getting hard to knock this market down, despite an extended 7-week rally and an overbought condition. Frustrating if you're looking for a pullback, but beautiful if you're fully invested.

Consumer confidence for April just came in better than exepcted, with a reading of 39.2 vs. 26.0 last month. It is likely that the recent stock market rally has helped boost sentiment, and hopefully this bodes well for a continued pickup in consumer spending.

Banks are lower after the WSJ reported that BAC and Citi may need to raise billions of additional capital to satisfy regulators due to the stress tests. Northern Trust (NTRS) is selling $750 million of common stock in a capital raise of its own. Stress test results will be officially released May 4th.

Healthcare stocks are higher after solid earnings reports from Pfizer (PFE) and Bristol Myers (BMY). US Steel (X) is lower after reporting a worse than expected loss and saying its order book remains low and demand is expected to fall to a 50-year low. Ouch.

Asian markets were lower overnight on swine flu fears and concerns about bank capital; the dollar is lower this morning vs. the Yen and Euro; but oil and gold are also both lower; the 10-year yield is a touch higher to 2.93%; and the VIX is down a bit to 38.28.

Trading comment: I keep waiting to pull the trigger on some new buys, but haven't yet. Today could be the day for Visa (V), as it looks like that one is breaking out. I am also looking at FCX, which has pulled back nicely towards its 50-day average. I would like to see RIMM and GS pull back further before stepping up on those.

The market continues to work off this recent overbought condition more by going sideways rather than downward. This usually means that there is still a lot of cash that is looking to get invested and take advantage of market pullbacks. I still think there is a deeper pullback towards SPX 800 out there, so I don't want to get too aggressive, but I also need to make money during all this back and forth trading.