Monday Morning Musings

Nothing like coming back from vacation only to find your network down and unable to access pretty much anything. Ugh. Nevertheless, I am making do and should be up to full speed when the IT staff gets into the office.

As for the markets, they held up extremely well last week into quarter-end. And on Thursday, emerging markets got back on track with some very nice gains. I'll try to post some charts of this later.

I would not have been surprised to see the market pull back this morning on profit taking, after the run its had, but this energizer bunny market just keeps chugging higher. On Friday, with the markets closed, the govt. released the nonfarm payrolls report which showed the economy added 162,000 positions. This was the biggest gain in 3 years, even as consensus estimates were looking for 184k new jobs. Still, it is a step in the right direction for the economy.

This morning, there was also a couple of solid economic reports, with the ISM Services Index rising to 55.4, above expectations, the highest level for this index since mid-2006. Also, I have noted here how the recent housing data has been lumpy, but today's pending home sales report was a good one. Sales for February increased 8.2%, with the consensus looking for sales to be unchanged for the month. (Have you noticed how far off the consensus usually is for housing data?)

Apple (AAPL) is up slightly after the launch of its much anticipated iPad product. Stocks often pull back after running up into product launches, so I wouldn't read into today's action too much. Estimates show that Apple sold more than 300,00 iPads the first day, which isn't bad. Many analysts are raising their estimates and price targets to justify the strong demand. I have had a $300 price target on AAPL since late last year, but now more analysts are jumping on the $300 bandwagon.

The dollar is lower this morning, which is boosting commodities and the energy sector. Crude prices have topped $86, a level not seen since October 2008. And gold has also hit fresh highs near $1130.

Asian markets were mostly closed overnight for the holiday, but Japan was open and rose +0.50%. The 10-year yield is up to 3.99%.

Trading comment: I let our stocks run into quarter-end, but I am more inclined to take partial profits on stocks that are extended vs. adding to positions here. I prefer to raise a little cash, and look to add back to my fav positions on a pullback, of which I think we are a bit overdue. I am not calling for a big correction, but the market has basically been on a tear since its recent Feb. 5th lows, and so some consolidation and pullback would merely be healthy here.

long AAPL