Market Alert - Pre-Market

Futures vs FV: SP +1.25; DJ +2.62; NASDAQ +0.80

Not a lot of hard news and the stock market continues to show softer action with futures trading back and forth in a tight range around the flat line after a soft Monday opened the second week of 2017. No one wants to take the lead from the NASDAQ FAANG it seems, at least for now. This has been a rare streak of non-movement for the SP500 and headlines on many financial websites are talking of a slowing Trump rally. Duh.

Small Business Optimism, December: 105.8. A huge post-election surge from 94.9 in October. 50% say business will improve though earnings expectations are still negative. Obviously there is a LOT to disappoint if the Trump team does not follow through on what they were elected to do as is what happened back in George Bush's second term.

Lots of warnings, most in restaurants and retail: CMG, PLKI, KONA, BOOT, SCVL, EXPR

Oil: Libya ramps up production more than expected, another threat to the OPEC production deal. Who would have thought? OPEC members cheating. What is next, a lying politician?

Venezuela: Hikes minimum wage by 50%. Oh, THAT is a model to follow all of you minimum wage hike folks.


OTHER MARKETS
Bonds: 2.387% 10 year

EUR/USD: 1.0572 VS 1.0585

USD/JPY: 116.143 vs 116.023

Oil: 52.13, +0.17

Gold: 1183.70, -1.20


Moving into that pre-earnings time (already there) and the market is reflecting upon the rally and what can come with earnings. Okay, I am attributing more to the market than I should, but that is the situation and there is not a lot of new money being put to work.

Sure there are areas that are rising, e.g. FANG, some biotech, tech, but with negative breadth the past two sessions even with some big indices moving higher, that shows not many are following the lead of the few.

That said, some of the biotech/healthcare are getting money thrown at them. That can be another sign of the last stages of the rally, but they can run fast as we saw with EXAS and others, so we still like that group for buys.

At the same time a lot of stocks are stuck in the mud, and as noted last night, we will mind those positions that are struggling.


Jon Johnson, Chief Market Strategist
InvestmentHouse.com
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