Is That The Pullback Everyone Was Looking For?
For months as the stock market rose folks said they liked the market but wanted to wait for a pullback to buy. Of course, the market never really paused to give them a good buying opportunity. But now we are getting a 5% pullback from the highs. So my question is: are you buying now?
Often times when the correction finally comes, those folks looking to buy get cold feet. But the Dow, S&P 500 and S&P midcap 400 are all at their 50-day averages. This looks like a good spot to put some money to work and yesterday we were buyers on the weakness.
There isn't much in the way of market moving news this morning. Initial jobless claims totaled 346,000 which was below last week's tally.
Asian markets were lower across the board, with continued high volatility in Japan.
European markets are higher today after the ECB meeting. The ECB held rates steady at 0.5%. ECB President Draghi said once again the central bank is 'technically ready' for negative deposit rates. The Bank of England also left its rates and purchase program unchained.
Elsewhere, French unemployment rose to 10.8% from 10.5%, while Greek unemployment rose to a record 26.8%.
Among the sector ETFs, financials are leading the early action and utilities are bouncing from their recent drubbing. Tech stocks are lagging so far.
The dollar is lower today and commodities are mixed to higher. Oil prices are back above $95 and gold prices continue to struggle to stay above the $1400 level. Copper prices are lower today.
The 10-year yield is slightly lower to 2.09%. And the VIX is a tough higher near 17.60, highlighting expectations for market volatility to remain elevated in the near-term.
Trading comment: We were better buyers into yesterday's weakness, and would continue to buy on weakness. We said we had been hoping for a 5% pullback in the market and now that it is upon us we want to stick to the plan. We still expect another push higher into quarter end, although the markets could need some further consolidation to setup a new base.