By Gareth Soloway on April 6th, 2010 11:40am Eastern Time
The markets gapped slightly lower today on a stronger dollar. The dollar inched up overnight as word came of more Greece issues. It has truly been amazing that other countries so far have not voiced any problems. Italy, Spain, Portugal and others are obviously on the list of problem countries but have yet to say anything. Any normal economic or trading player knows the problems exist, but for now, the markets seem to avoid it. This market is a classic case of Don't Ask, Don't Tell. As long as the markets have their blinders on, they seem to chug higher.
Today is really no different. Regardless of the initial gap lower, the markets have headed sideways to higher almost every 10 minute candle of the trading day. See the chart below. Volume is now as dry as the Sahara Desert.
The SPDR S&P 500 ETF (NYSE:SPY) is flat to positive on the day. The lunch session is in full swing and the markets await word from the Federal Reserve later, when the FOMC Minutes are released. It is important to note that there has been talk over the last day, of a Federal Reserve meeting, possibly on raising the Discount Rate or other important rates. So far, we have had no word on action.
The financial stocks are driving this market higher today. After the passage of the Healthcare Bill, financial regulation was sure to follow quickly. Speaking opening, it does seem that the rhetoric has quieted down for now. Why you ask? Perhaps because the administration realizes the markets could sell sharply on it. Financial regulation will come, however, it will be done gently, with kid gloves on, as to not upset the markets. That has been the way the administration has handled things. Treat Wall Street like a celebrity, give them what they want and always be gentle. We all know what happened back in January when President Obama was not gentle with his initial talk of financial regulation. The markets dumped almost 10%.
JPMorgan Chase & Co. (NYSE:JPM) is leading the financial stocks today. It is up 1.15%. Wells Fargo & Company (NYSE:WFC) is also leading with a gain of 1.90%. Goldman Sachs Group, Inc. (NYSE:GS) percentage wise is not leading, with a gain of just 0.40%.
Gareth Soloway
Chief Market Strategist
InTheMoneyStocks.com
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