Yeah for Bernanke! Sorry about the lateness of my post today. I recently made a big move to Central Time, and I am getting a little adjusted to the time difference.
Anyways, let us get into the thick of it. Bernanke getting reappointed to the second term. This is definitely great for the economy, in my opinion, but I am not sure that it does all that much for stocks in the shiort term. It may pump the market a few extra points, but that is it. Thebig news we have today is the CB Consumer Confidence report coming out at 10 AM. We also have two home price indexes on the data front and a manufacturing index, but they should have less importance on the market today.
The futures are up higher, with the Dow gaining close to 60 points and the Nasdaq 7 in pre-market trading. I think this is mostly some quick emotion buying on the Bernanke news. There as of now is not really a driving force for that. Typically, one would say lower oil prices is good for a majority of stocks, and oil is down. However, it has been typical as of late that the two follow one another.
The biggest reason I am being cautious is we saw China slip 2.6% today, and the rest of the world follow it into the red. I think this higher open is setting us up for a quick pullback. Yesterday, we saw light volume and rising short interest, and Bernanke coming back is not going to be able to raise enough volume.
On some good news, Burger King reported better than expected earnings and Staples met expectations of analysts. BKC is up over 4% in pre-market trading, while Staples is down 2%.
So what to play on a day like today. I think we might be able to turn our attention to the oil markets.
Buy Pick of the Day: Ultrashort Proshares Oil and Gas ETF (DUG)
This ETF, which plays as the inverse to the oil market, may be just the sweet pickup for today’s session. Oil fell in Asia, and the Brent Crude is down in Europe, as well. This was part of a larger pullback in China and the rest of the globe. Oil seems to be in this $65 – $75 range until it gets some sort of catalyst. Bernanke is not one of them. Consumer confidence could move…
