Market Alert - Pre-Market

Futures vs FV: SP +5.68; DJ +37.14; NASDAQ +16.24

Futures are higher even as CNBC discusses how the Trump rally is fading. Specifically it notes a switch to large cap defensive. Really? Many of the Dow and SP stocks have rallied for quite some time and are still doing so; no switch there. They cannot find anything positive in the market, talking about where SP500 is right where it was a week ago, how NASDAQ put in 3 days of less than a point gain -- all the while ignoring SOX at a higher high, RUTX on the rebound, and NASDAQ not in a bad position. The anchors opine market is not sure what it wants (and neither are they). Yet the market continues moving up.

Bloomberg talks about Openheimer saying a summer correction is coming, though they do say it is too early to play for it and that the SP500 will be higher before that. Indeed, their indicators point higher. This is another financial station WANTING a downside story. OPC indeed says they see more early/mid-cycle indications versus late cycle. Wow, a negative headline for the market that was totally reversed by the interview WHERE have we heard/seen this before?

Lots of negativity . . . but not. We agree with OPC: a correction is coming at some point, but right now the indications are upside.

Lots of discussion about the Thursday House vote on healthcare reform. That is a correct discussion. A market built on real economic hope and change depends upon making concrete steps to get there. Thursday is thus important. The market appears to be believing it will happen as the President meets with House republicans this morning. As we laid out this weekend, the path is there thanks to the OMB analysis.

As always, the news is noise. Interesting, sausage making entertainment, but noise nonetheless. Look at the leaders and the index action. SOX is hitting higher highs and that is usually good for the market.


OTHER MARKETS
Bonds: 2.493% vs 2.463%. Bonds fading some after a 4-day bounce

EUR/USD: 1.0799 VS 1.0739

USD/JPY: 112.563 VS 112.496

Oil: 48.40, +0.18

Gold: 1233.80, -0.20


Futures are at the session highs but that is also the top of the morning range, i.e. they are not rallying higher and higher but range-bound. That means that the bids will need to keep coming and pushing. We will have to see if the bids hang in after the open and push last week's Wednesday post-FOMC rally.

Jon Johnson, Chief Market Strategist
InvestmentHouse.com
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