S&P Holds Steady Despite Some Earnings Misses

The market is slightly higher in early trading, despite some earnings misses from a couple of market bellwethers. Google (GOOG) was the big one. The company's revenues were solidly above estimates, growing 27% from year-ago levels. But as I feared, spending at the company was way too high, and EPS came in below estimates. So the stock has gapped below its 200-day average, down a little more than 6% currently. I suspect that GOOG will be in the penalty box for a while, but longer-term this will likely prove to be a good buying opportunity.

Bank of America (BAC) also missed earnings but beat on revenues. Overall, the report looked pretty solid. The stock started off the day higher, but has since moved into negative territory. Overall, financials are up a bit.

Overnight, China announced its Q1 GDP came in at 9.7%, a healthy rate. But inflation is moving higher, with the CPI rising 5.4%, up sharply from Q1 last year when it was 4.9%. The PPI is also a lot higher at 7.3%. China closed with a 0.3% gain last night.

Oil and gold prices are on the rise again also. Oil prices are up today, back to $109. And gold prices are making a new record high at $1485.

The 10-year yield has fallen back to 3.41%; and the VIX is down 3% to 15.77, but these low levels look like they may be affected by today's options expiration.

Trading comment: The Nasdaq is heavy today after Google's earnings report. Defensive sectors like utilities and healthcare are leading the action. Energy and materials are faring okay also. So far, earnings season has not produced any eye-popping winners. Let's hope next week's batch of reports brings some more positive action. The S&P 500 has recaptured its 50-day average so far today. A close above this key moving average would be a small win for the bulls heading into the weekend. Rest up.

long BAC, GOOG, GLD