Morning Commentary
I am a big fan of market pullbacks and challenges like the one we are in the midst of right now. I even like the hand-holding part; however, some “investors” are far too skittish to be in the market, never expecting down days, let alone a string of down days from the past couple of weeks. Be careful of the illusion of mass panic; it’s akin to setting yourself on fire in a crowded theater.
With that being said, yesterday was an impressive session that proves there is a strong bid and underlying support for the market.
There were reversals in several asset classes, including:
The problem is the bias has shifted to the downside despite Monday’s resolve. It’s one thing for buyers to materialize when the Dow is off 184 points. Now, the question is how to get that train moving with a full head of steam. I suspect there has to be more positive economic data or in the case of reads on confidence and other soft data, recent spikes must be maintained.
Technical buy signals on the upside, it’s all about breakouts:
Meanwhile, the Dow stumbled eight straight sessions; NASDAQ Composite was powered by technology stocks, including many that aren’t household names. The index is up in 10 of the past 13 sessions and looks invincible even though there is a slight five-day loss.
Healthcare, led by hospitals was the big winner yesterday, but the most compelling sector was SPDR Select Materials (XLB).
A lot of Trump stocks came off their lows, and most are oversold on a short-term basis. You don’t need to pick exact bottoms, but the risk-reward ratio is shifting to the point where investors can start to nibble on those key names.
It’s all about patience, and not hitting that panic button.
Today’s Session
Lots of news coming from Washington DC; however, most of them are scuttlebutt and hype. The market has begun to shift into ‘show me’ mode.
Anything that doesn’t move the jobs, wages and the economic needle could mean lost opportunities. On that note, I’m thrilled with a report from the White House looking to work, at the same time, on taxes and infrastructure. I’m sure there will be some bipartisan support for lower business taxes. Everyone loves the idea of infrastructure spending, which should be called ‘infrastructure investments’.
Right now, it’s clear the market needs a spark, and that spark could come in the form of a quiet epiphany as oversold stocks begin to put in bottoms.
Strong earnings results from last night and this morning has Darden (DRI), Red Hat (RHT) and Carnival (CCL) looking to open much higher.
Good things are happening in micro and macro level.
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3/28/2024 1:39 PM | Fruitful Quarter |
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3/27/2024 9:32 AM | U-TURN? |
3/26/2024 1:08 PM | Everything Is Up |
3/26/2024 9:42 AM | TAPPED OUT (I HOPE YOU AT LEAST GOT A T-SHIRT) |
3/25/2024 1:33 PM | Not A Mutiny |
3/25/2024 9:35 AM | STAYING THE COURSE…BEYOND TECH |
3/22/2024 12:56 PM | Toll on Americans |
3/22/2024 9:38 AM | A TAD TIRED |
3/21/2024 1:55 PM | Building on Gains |
3/21/2024 9:30 AM | A COMFORTING FED |
3/20/2024 1:33 PM | Pivotal Moment |
3/20/2024 10:00 AM | HERE COMES THE FED |
3/19/2024 1:33 PM | Picking Up Steam |
3/19/2024 9:35 AM | RUMBLINGS IN THE BOND MARKET |
3/18/2024 1:48 PM | Mag 7 is Back |
3/18/2024 9:39 AM | THE PARTY IN SAN JOSE WILL BE LIT |
3/15/2024 1:38 PM | Realtors Settle |
3/15/2024 9:33 AM | AN UNEASY PAUSE |
3/14/2024 1:43 PM | Sticky Inflation |
3/14/2024 9:48 AM | GOING TO A GO-GO |
3/13/2024 2:16 PM | Taking a Breather |
3/13/2024 9:51 AM | ALL SO EPIC |
3/12/2024 1:42 PM | Marching Higher |
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