Futures vs FV: SP +0.75; DJ +1.35; NASDAQ +5.02
Stocks futures are up quite modestly, rebounding from the afterhours drop on the faux Turkey coup. More and more are claiming a false flag move with pre-coup prepared lists from the military, press, and populace to 'purge' the president's enemies. My view to this is the writing was on the wall; the despots are using the actions/inactions among the world's powers to do as they always wanted to do. The US is focused on the South China Sea (ships are encircling it), escalating that issue while others are left somewhat untended. The world is a pot on a hot stove.
To lighter news . . .
M&A: Softbank is buying ARMH
Earnings: HAS beats. BAC beats bottom line (TL in line) aided by LOTS of cost cutting as its profit fell 19%.
China Home prices: 1.8% vs 1.9% prior mo/mo; 7.3% vs 6.9% year/year
Other news: None
OTHER MARKETS
Bonds: 1.561% vs 1.58% 10 year. Up modestly though still off the recent highs that took TLT down hard to the 20 day MA.
EUR/USD: 1.1050 vs 1.1035
USD/JPY: 105.50 vs 104.73. Yen was up sharply but has backed off.
Oil: 45.07, -0.88
Gold: 1330.80, +3.40
They are calling this a 'relief' move from the after hours and I suppose it is compared to where stocks were, but in terms of the Friday close stocks are flat.
Recall Friday the Dow hit a new high while SP400 is bumping at a high. SOX, NASDAQ, RUTX still a long way to go, but also dealing with interim resistance of their own. In short, indices primed for a pause/test after the surge up to resistance. They are, however, showing great resilience.
We have many new plays to look at but frankly would prefer a bit of a test in the market overall before committing a lot of new money. We will see how they perform and how the market works, however, for new entries. We still want to take some gain if we get the opportunity.
Jon Johnson, Chief Market Strategist
InvestmentHouse.com
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