I am as guilty as anyone of being a worrywart about many things. In the business world, I like many day traders have kept an eye on the Greek situation, geopolitics, and don’t understand how a nation having more debt than my little brain can comprehend is good for anything or anyone over the longer-run. Yet, the stock market continues to ramp higher. Most people are missing the basic picture. Let’s put aside the notion that the United States markets are a “bastion” for Asian investors worried about the Chinese property market or Europeans not know where to put money (which by the way is a two-pronged truism for what is occurring as foreigners are putting money into American markets). The fact of the matter is that in the immediate-term, the economy is improving. On Friday, we got data which showed that sales of new homes were up 27% in March (the biggest gain in 47 years) and orders for durable goods ramped higher as well. Now sure, I am well aware that the ending of a government tax credit on April 30 is helping to spur a rush into homes and do not deny the existence of the artificial jump but also know that the jump did indeed occur. But bookings for long-term owned things like industrial computers climbed 3%. Total orders did drop slightly, but was because of an artificial decline in commercial aircraft yet demand for things like car and truck parts rose sharply. So, ‘artificial” or not, the fact of the matter is that there is growth in the economy in the immediate-term (which is expanding). Thus, the markets haven’t cared whether it is government stimulated or not thus the sustained rise in stock prices for the past year.
Markets were strong overnight with the major Asian markets up around 2% (2.3% in Tokyo, 1.7% in Hong Kong). In Europe, markets are higher as well to the tune of about ¾% on average. Oil is up a bit over and above 85 a barrel with the euro a tinge weaker. Futures are quiet, but slightly higher. Big cap financials are mixed, but techs are stronger. For the day, look for a maintenance of the strength in somewhat quiet overall trading. But there will be tremendous action underneath the surface on some decent earnings flow (most companies reported good results), lots of merger activity, and some microcaps on the move once again.
Reiterating-
If the whole story is not there -
If something is good, assume either a short thru unchanged or an A-B-A2 (preferably to the downside in a downside market and the upside in an upside market) based on direction of the market unless specified.
If something is bad, assume either a buy thru unchanged or an A-B-A2 (preferably to the downside in a downside market and the upside in an upside market) based on direction of the market unless specified-
Good- The following stocks have good news and/or a strong technical pattern
MRK- closed near a high after announcing intra-day information of U.S. health care reform legislation
CHCI- among the small-cap homebuilders which closed near a high
SII- closed near a high
NFX- closed near a high
WFT- closed near a high
SLB- closed near a high after posting great earnings
DEAR, FMBI, STSA, FPBI, BAYN- among the small regional bank stocks closing near a high
WDC- closed near a high after posting earnings
UAUA- closed near a high
SLXP- closed near a high
CSNT- closed near a high
SOHU- decent earnings
HUM- decent earnings
WHR- great earnings
DRAD- received 510(k) clearance from the U.S. Food and Drug Administration (FDA), enabling the Company to market and distribute its ergo large field-of-view, general-purpose portable imaging system.
WX- being bought out for $21.25- 11.25 in cash and 10 in CRL stock
DTG- being bought out by HTZ for 41 including a cash dividend of 6.88, 25.92 in ash on close, and .6366 shares of HTZ
CAT- good earnings guidance
CRNT- decent earnings
DNDN- announced presentation of additional data from phase 3 IMPACT data
CHKP- decent earnings
Bad-The following stocks have bad news and/or a weak technical pattern
BCR- closed near a low in an island reversal after posting earnings
AMZN- closed near a low after posting earnings
GS- closed near a low
CRL- buying out WX and poor earnings
RMBS- negative article in “Barron’s”
Earnings:
MON APR 26 BEFORE
ACV BLK CAT
CHKP EXP HUM
LO OSIS ROP
SOHU WHR
MON APR 26 AFTER
ACL AMP BSX
CNI ELX HMA
JEC MAS OMI
PCL PPDI RCII
SANM SLG TXN
UHS VECO WMS
Good luck today.
Epiphany Trading, LLC
www.epiphanytrading.com
Erik R. Kolodny- Chief Markets Strategist
Brendan P. Byrne- President
Joseph R. McCandless- Managing Partner
D. Timothy Seaquist- Managing Partner
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