Thursday, April 17, 2014

Earnings Season Heating Up

Markets started off a bit lower in the first hour of trading but have since recouped early losses and are now back in positive territory.

Earnings season kicked into a higher gear last night and this morning with a large swath of companies reporting.  This week is a shortened week due to the markets being closed tomorrow for the Good Friday holiday.

Stocks rising on earnings: BX, MS, GE, GS, SNDK, PEP, TSM, BHI, COL, CMG

Stocks falling on earnings: GOOG, IBM, SAP, SLB, UNH, DD, BLK, PM, TZOO

Asian markets ended mixed.  China's foreign direct investment rose 5.5% vs. 10.4% in the prior period.  And Japan's pension chief said the fund is adjusting its portfolio towards greater equity exposure.

European indexes are little changed ahead of their long weekend.  Europe will be closed Monday for Easter.

Oil prices are up again near $104.35.  And gold prices are struggling to hold on to the $1300 level.

The 10-year yield is higher to 2.67%.  And surprisingly the volatility index has dropped another 5% all the way back to 13.50.  I guess folks have forgotten their worries from a few days ago and all is well in the markets now-- 'til the next shoe.

Trading comment: The S&P 500 continues to lead the action in terms of holding above its 50-day average.  But with the other major indexes still below their respective 50-days we feel caution is still warranted.  As such we are not yet putting cash back to work in any meaningful way.  Although we would be inclined to pick at stocks we like that have taken hits such as GOOG for example.

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