Monday Morning Musings
The markets are shooting higher out of the gate this morning with the S&P 500 getting nearer to new highs again. This morning the SPX topped the 1590 level, but it needs to hit 1598 for a new high. That doesn't look like it will be today's business but we wouldn't be surprised to see it soon.
In economic news, pending home sales rose a better that expected +1.5% in March, which it a 3-year high for this datapoint. Homebuilder stocks are higher again today.
There were a handful of earnings reports this morning:
Stocks higher on earnings: ETN, HNT, MCY
Stocks lower on earnings: L, ROP
Asian markets were mixed overnight, but both Japan and China were closed for holidays.
Europe's markets are higher today after the new Italian government was sworn in over the weekend. Elsewhere, Spanish retail sales fell -8.9% and a Eurozone business and consumer survey declined to 88.6 from 90.1.
The dollar is lower today helping to boost commodities. Gold prices are higher near $1466. Oil prices are up to $93.65. Ag prices, silver and copper are all higher today also.
The 10-year yield continues to languish near low levels around 1.66%. And the VIX is down 1% today near 13.50. As we have been saying recently, when the VIX closed below the 15 level again it was likely an indication that traders were expecting more rallies in the market. Of course, selloffs have been few and far between thus far in 2013.
Trading comment: Buy the dip remains the only mantra that has worked this year. Of course, many strategists continue to look for that 5-10% pullback that has proved elusive thus far. The most recent dip was more of the 2-3% variety. Beneath the major indexes we continue to look for companies that reported solid earnings and whose stocks either pulled back after an initial spike higher, or those stocks that are retaking their overhead 50-day averages and putting themselves in position to work higher. AAPL is getting closer to testing its 50-day again, which could open up some running room for the stock to work higher.
KAM Advisors has long positions in AAPL