By Gareth Soloway on March 30th, 2010 12:04pm Eastern Time
The markets started the day with a small gap higher and quickly added to the gains on light volume. It seemed as if the DOW would make a run at the 11,000 level. Consumer Confidence was reported at 10:00am ET, showing a small positive increase. The index that measures the general publics opinion on the economy and how healthy they feel, rose to 52.5 in March from 46.4 in February. This was slightly ahead of expectations.
While this may have seemed like good news, the markets paid little attention. We are seeing good news not be a key driver of market gains. Rather, the gains of late are coming on rotation of money into stocks as money managers have chased the market into the quarter end, as well as extreme light volume issues. Today, the Consumer Confidence number gave the markets an initial thrust higher but quickly started to drop. The drop was sharp, but not because of the Consumer Confidence. Instead, it was because the dollar started to inch higher and yields moved towards 4.00%. These two factors triggered some solid selling volume and took the markets to the negative side.
The markets slammed into the lows from yesterday and have since bounced, as volume has stalled and the dollars rise has also stalled. Interest rates do seem to be on the forefront of the markets worry. Many still believe the DOW will be pushed to the 11,000 level by the end of the holiday shortened week. Volume will continue to get lighter and it will not be hard to hold the markets up or push them higher. The markets will await the Jobs Report on Friday, even though the markets are closed.
Apple Inc. (NASDAQ:AAPL) surged yesterday after hours on a report that they may have a new Iphone coming out with Verizon. The stock traded over $238 yesterday after hours but today is having trouble holding those gains. It is trading near the $236 level up 1.60%. The interesting thing about Apple Inc. from a technical standpoint is the inability in the last two trading days to hold gains. Yesterday, Apple gapped higher and closed near the lows of the day and again today, we are seeing the same price action. This is worth watching in the coming days and weeks.
Financial stocks are getting hit today as renewed fears of financial regulation are hitting the markets. Goldman Sachs Group, Inc. (NYSE:GS) fell off a cliff after being slightly positive just after the open. It dropped over $3 to a low of $170.70. Since that move, it has bounced along with the markets. Volume is getting extremely light. JPMorgan Chase & Co. (NYSE:JPM) is also lower on the day.
After a big move higher yesterday, Exxon Mobil Corporation (NYSE:XOM) is dropping slightly as the strength in the dollar is putting pressure on oil. A drop in oil is usually a negative for Exxon Mobil Corp.
The markets continue to trade just slightly negative on the day. Volume is getting lighter and lighter. The dollar is slightly higher but now off its highs. To get more hardcore analysis, trades, guidance on the markets and education, join the Research Center at InTheMoneyStocks. Just yesterday, a trade ran 25% for our members. Enjoy the profits!
Gareth Soloway
Chief Market Strategist
InTheMoneyStocks.com
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