Lackluster Gains For Stocks Despite More Solid Earnings Reports

The market is getting a small bounce in early trading, which is somewhat disappointing in light of the solid earnings reports last night, but not all that bad in light of the weak overseas trading before the open.

There were a handful of solid earnings reports last night, including Apple (AAPL), VMWare (VMW), and Travelers (TRV). JNJ and Verizon (VZ) were also pretty good, but those stocks are down slightly on the news. Apple's earnings report was very strong. I covered the conf call for TheStreet.com, and will post my comments here a bit later.

In overseas news, Asian markets were lower across the board overnight after China hiked reserve ratios at certain banks, and S&P lowered its outlook on Japan's credit rating. Europe was down less after news that the UK economy emerged from recession with +0.1% GDP growth.

January Consumer Confidence rose to a level of 55.9, which is nicely above December's reading of 53.6. This is a trend we really need to continue.

The dollar is getting a bounce due to all the overseas weakness, and weighing on the commodity complex. Oil is a bit lower to $74.70 and gold is also lower to $1093.

The 10-year yield is down a bit to 3.62%, and the VIX is another -6.1% lower to 23.85.

Trading comment: The market is getting very oversold, and should get more of a bounce at some point. The put/call ratios are also rising, which is a good sign as it shows us that complacency has been shaken, which has helped us bottom quicker in the recent past. While short-term trades are okay in this environment, I still think a better buying opportunity will come on the next dip, so I am keeping some powder dry.

long AAPL, VMW, KIE