The market traded back and forth in a tight range Wednesday as the macro S&P wedge pattern continues to tighten. Investors remain cautious at these levels about putting long-term money to work in the face of rising oil prices and persistent unrest in the Middle East. Saudi Arabia’s “Day of Rage” is scheduled for Friday, so it will be interesting to see how that plays out. At this stage, those traders who are trying to be aggressive looking for large follow-through type moves are getting frustrated. Right now it is best to back off and wait for the price action to signal the direction for the next leg of the market.
As far as sectors, the agricultural stocks continued to get crushed after downgrades to The Mosaic Company (MOS) and PotashCorp./Saskatchewan (POT), which were shifted to Hold from Buy at Citigroup. In the past multi-day pull-ins in the fertilizers stocks have been buyable, but with these stocks now below their moving averages and analysts souring on their long-term growth prospects, their fate this time around remains hazy.
After the close rare earth leader Molycorp, Inc. (MCP) released a markedly bullish earnings report, including $0.03/share earnings vs. -$0.07 expected and $21.7 million in revenues vs. $14m expected. The stock is nearly 6% after hours, and has pulled the rest of the stocks in the group up with it after reiterating its beliefs that China will enforce export quotas for the rest of 2011.
For more market and stock commentary, watch the T3Live.com Daily Recap video with Scott Redler below.
*DISCLOSURE: Scott is long GLD, AAPL, BAC, MGM, LVS, AMZN, INVE
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