Market Alert - Pre-Market

Futures vs FV: SP +9.78; DJ +107.25; NASDAQ +22.08

One more time . . . It would appear, after a day of indecision (or rest as it were -- a mere pause) stocks are going to celebrate tax reform once more. The House even gets to vote twice, just in case any members failed to get the right photo op the first time. In the wee hours of the morning the Senate passed the bill along party lines at 51 - 48 (McCain absent) with the two procedural fixes. Now it goes back to the House today. Given the size of the 'simplified' tax code bill, it may not make it to the President to sign by Friday. Oh well.


Stocks across the board are set to rise, NASDAQ looking strong but oil stocks, retail and others are solid as well. Love those Santa rallies, even if they are aided by arcane, indeed insane, Senate rules. Gary Cohn says the tax reform will continue to be the gift that keeps on giving to the stock market. That it is, Edward (what Christmas favorite is that one from?).


Mtges: -4.9% vs -2.3% prior week. they will worsen given the rising interest rates.


Earnings: A hit parade indeed.

Beats: MU; FDX; BBRY; GIS (TL); RHT; WGO

Misses: SCS (TL)


Existing Home Sales out at 10:00ET


OTHER MARKETS
Bonds: 2.488% vs 2.459% 10 year. Longer end continues to rise finally as the 'conundrum' eases -- a bit.

EUR/USD: 1.1844 vs 1.18413. Dollar rebounds -- slightly.

USD/JPY: 113.27 vs 112.870. Dollar rebounds quite sharply.

Oil: 57.86, +0.30

Gold: 1296.10, +4.90


Futures rallied after the Tuesday close and held those gains all morning. Now cracking to morning highs, the early rally looks solid.

Our plan remains the same, i.e. letting the excitement carry positions higher (wish we still had all of the GOOG, but on the other hand ROKU is flat) as long as the rally will, taking gain when targets are hit or after a good run the stock starts to show topping. Just prudent to log the gains while they are there.

New positions depend upon the stock and the entry. Good patterns that are not extended. Chips will be watched given MU's strong earnings. We have plays for CAVM, MRVL and will see if they can show something more than the weak upside demonstrated thus far this week. TSLA made a pullback and today UPS announced an order of 125 of its electric semis. Maybe TSLA provides an entry coming off that test.



Jon Johnson, Chief Market Strategist
InvestmentHouse.com
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