Investors continue to sit on the sidelines amid escalating violence in Egypt and with a slew of economic data on tap the rest of the week. The market rested yesterday after Monday’s potent breakout to start the month, a theme we have seen since the start of last year. Last Friday’s potent sell-off is now a distant memory. The protests in the North African country have continued to grow in size and intensity as pro- and anti-goverment citizens clash. However, it appears the far-off unrest, despite its possible ramifications for a current US ally, is having little effect on the equity markets.
Futures are starting to fade a little bit this morning, but will likely be pushed in one direction by jobless claims data that is due this morning. January same-store sales for a host of retailers is also on tap.
Tomorrow morning we will see the all-important non-farm payrolls number and unemployment rate. Also, a series of corporate giants are set to report earnings today, including Merck & Co., Inc (MRK), The New York Times Company (NYT), The Dow Chemical Company (DOW), and Kellogg Company (K).
Eye on the Casinos
The casino group is in focus ahead of the earnings report from Las Vegas Sands Corp. (LVS) after the close today. After a strong run over the past two years, the group has taken a rest after hitting most analyst price targets. Macau revenue numbers were strong for January, jumping 33% to $2.3 billion, and a strong earnings beat from the casino giant seems possible. We feel that LVS earnings could be the catalyst for the next move in the casino group. Also watch group leader Wynn Resorts International (WYNN) after the report.
AAPL Looking Juicy
Apple Inc. (AAPL) is a market leader that has whipped around wildly since Steve Jobs’ medical leave announcement, but after two weeks of manic action the stock once again has an appealing technical set-up. Apple remains a strong value and growth story. On a break above the recent pivot of $345, the stock should see new highs. Remember, AAPL still has the stock-split weapon in its back pocket in case investors start to waffle.
F5 Networks Attempting to Enter Gap
F5 Networks, Inc. (FFIV) narrowly beat earnings estimates in its report January 19, but missed slightly on revenue and lowered guidance. The mediocre report triggered a 20% sell-off in the stock that spilled over to the rest of the cloud sector. It’s the second such debacle in the cloud group, the other coming October 6th, and investors have grown wary of the sector. However, with recent technical action, FFIV presents a very attractive risk-reward proposition after putting in a recent base, says Evan Lazarus of T3Live.com.
F5 Networks looks like it is setting up for a retracement back into the $119-124 area, according to Lazarus’ analysis using multiple time frames. It already dropped to fill the gap through the $104 area, and feels like it has worked off the extreme weakness. Yesterday’s action is FFIV was extremely bullish as the stock surged to near the top end of its recent range, boosted by a strong earnings report from fellow cloud company Acme Packet, Inc. (APKT).
*DISCLOSURE: Scott is long AAPL. Evan has no positions.
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