Thursday moved the market off a weak opening to close green and erase most of Wednesday’s losses. Volume came in light for the NYSE and Nasdaq, significantly under-pacing Wednesday’s volume. Futures volume fell as well leaving us still with more volume with move down and light lifts. The VIX closed at 16.48 and the TRIN at .60 bullish on the day. The A/D and U/D very on the opening and didn’t tick up until 10:50, the levels we opened at were levels we would look for a trend day off. Once again we had that slow motion turn and the bulls came in to push up to neutral territory on the breadth. Gold closed unchanged on the day at $1153 and oil down 49 cents to $85.39 a barrel.
The four day range still holds the market near the years highs and the uptrend with very shallow pullbacks. Semiconductors (SOX) and Hardware (HWI) closed red on the day, while banks and brokers closed green and strong on the day. Leaving the market lacking tech leadership, but the widely held big cap stocks had a solid day for the most part. That still leaves the market with the highs as the line in the sand to get the bulls a big move through key levels overhead.
Futures are still under the same spot we’ve been watching all week. The ES back over 1185 is likely to ignite the buyers for new highs on the week and move onto 1195.50. A breakdown at 1177 we look for 1165.75 and that puts us within striking distance of 1162.25 weekly pivot. The NQ has 1963.25 key support with 1958 below that and then 1950.25 with 1948 weekly pivot. Back over 1981.25 look for 1988.75 to test. The market had the bears door open today and held on to see one VERY slow and gradual turn that didn’t have the big powerful bounce to turn it. Which maybe is a sign the bulls were not stepping in heavy handed on the pullback, but they outnumbered the bears and came around finally.
Going into Friday it is hard to expect a lot with earnings season kicking off Monday with Alcoa (AA) after the bell. The rest of the week will have some big hitters and gets things rolling along. We did not pullback ahead of earnings season and that leaves the market in need of a strong turn out for guidance and beating expectations. Otherwise the catalyst of pricing in economic recovery is going to have a BIG problem. A sell the news setup could be right around the corner for this market. Leaving likely to see a range bound Friday and low volatility.
Economic data for the week (underlined means more likely to be a mkt mover): Friday 10:00 Wholesale Inventories. Monday 2:00 Federal Budget Balance. Tuesday 8:30 Trade Balance, 8:30 Import Prices, 10:00 IBD/TIPP Economic Optimism, 10:45 FOMC Member Tarullo Speaks. Wednesday 8:30 Core Retail Sales, 8:30 Core CPI, 8:30 Retail Sales, 8:30 CPI, 9:30 FOMC Member Pianalto Speaks, 10:00 Fed Bernanke Testifies, 10:00 Business Inventories, 10:30 Crude Oil Inventories, 2:00 Beige Book. Thursday 8:30 Unemployment Claims, 8:30 Empire State Manufacturing Index, 9:00 TIC Long Term Purchases, 9:15 Capacity Utilization Rate, 9:15 Industrial Production, 10:00 Philly Fed Manufacturing Index, 10:30 Natural Gas Storage, 12:15 FOMC Member Bullard Speaks, 1:00 NAHB Housing Market Index, tentative Treasury Currency Report. Friday 8:30 Building Permits, 8:30 Housing Starts, 9:55 Prelim UofM Consumer Sentiment, 9:55 Prelim UofM Inflation Expectations.
Some earnings for the week (keep in mind companies can change last minute: Friday pre market BTH, STZ and nothing after the bell. Monday nothing pre market and after the bell AA. Tuesday pre market FAST, INFY and after the bell CSX, INTC, LLTC, TLB. Wednesday pre market ASML, JPM, PGR and after the bell JBHT, YUM. Thursday pre market SCHW, FCS, BTU, PPG, TITN and after the bell AMD, AMLN, BIIB, CBK, GOOG, ISRG, PLCM. Friday pre market BAC, GE, MAT and after the bell IEX.
SOX (semiconductor) closed -5.42 at 371.47. Support: 369.81, 368.42, 367.19, 363.86. Resistance: 372.55, 373.87, 375.18, 377.05, 378.28
