David Moenning�s Daily State of the Markets: 11/21
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Stocks surged right out of the gate on Friday as a couple of mergers, positive earnings from the likes of GE and Hewlett Packard, investors chasing the breakout, and the monthly expiration of options and futures combined to push the Dow up almost 80 points in the first few minutes of trading. However, sensing that the run was beginning to get a bit overheated, traders quickly decided to �fade� the move (i.e. go the other way) and by lunchtime the gains were gone.
But even with the market overbought, the bulls once again refused to yield. So with the help of some late-day buying, our bovine buddies closed out the session by putting another forty-six points up on the board. However, while it was enjoyable to see a the bulls put the finishing touches on a fourth straight week of gains, we probably shouldn�t read too much into the action since Friday was an expiration day.
Looking ahead, we�ve got a holiday-shortened week on our hands this week as the markets will be closed in observance of Thanksgiving on Thursday and then close at noon on Friday. The playbook tells us that stocks have a tendency to advance the day before and the day after the Thanksgiving holiday, and that volume is likely to be painfully light.
In terms of economic news this week, the calendar is very thin. We�ll get a report on the Index of Leading Economic Indicators this morning at 10:00 am and then on Wednesday the University of Michigan�s Consumer Sentiment numbers will be released. Also on Wednesday we�ll get a peek at the Help Wanted Index. And after that, all eyes will turn to the turkey and the television.
Turning to this morning, the market seems to like the announcement that GM will offer a plan to restructure and the closing of manufacturing plants. Running through the pre-game indicators, oil is trading higher by +$0.51 to $57.72 as colder weather is making its way to the Northeast, bond yields are moving a smidge lower to 4.47%, and stock futures are pointing to a higher open (Dow +23, S&P +1.0, and NASDAQ +1.0).
So with stocks on a tear recently and the market now becoming overbought, the only real question is when, and from what levels, the next little pullback will occur?
Stocks "In Play" This Morning:
CSCO � Downgraded to Neutral at Oppenheimer
SFA � Downgraded at Oppenheimer � No competing bids seen
GOOG � Barron�s Says GOOG could face tougher competition in online advertising
HAL � Pentagon alleges wrongdoing over no-bid contracts in Iraq � HAL cooperating fully
NKE � Downgraded at JPM
Disclosure: At the time of publication Mr. Moenning and/or related companies are long the following positions: CSCO
To see David Moenning�s Trading Record, his (Strong Buy) List, or the rank for any Top Guns Stocks, visit: http://www.AnotherWinningTrade.com/SI
Stocks surged right out of the gate on Friday as a couple of mergers, positive earnings from the likes of GE and Hewlett Packard, investors chasing the breakout, and the monthly expiration of options and futures combined to push the Dow up almost 80 points in the first few minutes of trading. However, sensing that the run was beginning to get a bit overheated, traders quickly decided to �fade� the move (i.e. go the other way) and by lunchtime the gains were gone.
But even with the market overbought, the bulls once again refused to yield. So with the help of some late-day buying, our bovine buddies closed out the session by putting another forty-six points up on the board. However, while it was enjoyable to see a the bulls put the finishing touches on a fourth straight week of gains, we probably shouldn�t read too much into the action since Friday was an expiration day.
Looking ahead, we�ve got a holiday-shortened week on our hands this week as the markets will be closed in observance of Thanksgiving on Thursday and then close at noon on Friday. The playbook tells us that stocks have a tendency to advance the day before and the day after the Thanksgiving holiday, and that volume is likely to be painfully light.
In terms of economic news this week, the calendar is very thin. We�ll get a report on the Index of Leading Economic Indicators this morning at 10:00 am and then on Wednesday the University of Michigan�s Consumer Sentiment numbers will be released. Also on Wednesday we�ll get a peek at the Help Wanted Index. And after that, all eyes will turn to the turkey and the television.
Turning to this morning, the market seems to like the announcement that GM will offer a plan to restructure and the closing of manufacturing plants. Running through the pre-game indicators, oil is trading higher by +$0.51 to $57.72 as colder weather is making its way to the Northeast, bond yields are moving a smidge lower to 4.47%, and stock futures are pointing to a higher open (Dow +23, S&P +1.0, and NASDAQ +1.0).
So with stocks on a tear recently and the market now becoming overbought, the only real question is when, and from what levels, the next little pullback will occur?
Stocks "In Play" This Morning:
CSCO � Downgraded to Neutral at Oppenheimer
SFA � Downgraded at Oppenheimer � No competing bids seen
GOOG � Barron�s Says GOOG could face tougher competition in online advertising
HAL � Pentagon alleges wrongdoing over no-bid contracts in Iraq � HAL cooperating fully
NKE � Downgraded at JPM
Disclosure: At the time of publication Mr. Moenning and/or related companies are long the following positions: CSCO
To see David Moenning�s Trading Record, his (Strong Buy) List, or the rank for any Top Guns Stocks, visit: http://www.AnotherWinningTrade.com/SI
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