The E-Mini S&P 500 broke through the $1408.00 previous high Monday to climb to $1415.50. Federal Chairman Ben Bernanke spoke about continuing the central bank's accommodative monetary policy to further improve the US job market. Chairman Bernanke addressed the National Association for Business Economics further confirming the 'extended period' was still in place for some time to come or the projected 2014.
The National Association of Realtors reported that the Pending Home Sales Index decreased by 0.5% to 96.5. Forecasts had been for an increase of 1.0% in February after the 2.0% increase in January. The risk assets gained the allocations for Monday weakening the US dollar and the US T-Bonds. The E-Mini S&P 500 has risen since December 2011 with no healthy retracement. It may now be a matter of following the volume to see that the market is supported at these levels. $1437.00 may be the next substantial resistance.
German Chancellor Angela Merkel announced that she would be perhaps willing to compromise on the structure of the funds set-up to bailout the ailing counties. The European Financial Stability Facility was to expire this June, but the recent talks to boost the firewall and suppress the contagion fears, have perhaps decided or may decide to continue the fund well beyond mid-2012 to perhaps mid-2013.
The European Stability Mechanism is the permanent fund designed to be the primary lender at a fixed $500 euro level. Germany had been the main opposition to running the two funds side by side. The European Financial Stability Facility has about $240 billion euros left and may run until it is cancelled. This is to be discussed further at the summit in Copenhagen on March 30 - 31st.
The German business sentiment increased for about the 5th month in a row adding to the optimistic outlook. This week's Italian and Spanish bond auctions should give a better indication of just how optimistic the Euro Zone may remain. The Euro Zone is still vulnerable to a variety of factors. Their unemployment numbers are massive and the people are striking and protesting the leadership that has enforced the reforms.
On the stock side: JP Morgan Chase and Co. (JPM) was up 2.2 4 % to $46.20. Citigroup Inc. (C) was up 0.79 % to $37.43. Bank of America (BAC) was up 0.81 % to $9.90. Alcoa Inc. (AA) was up 1.09 % to $10.22. Boeing Co. (BA) was up 1.64 % to $75.23. Caterpillar Inc. (CAT) was up 0.85 % to $108.80. General Electric Co. (GE) was up 1.37 % to $20.07. Halliburton Co. (HAL) was up 0.69 % to $33.63. Hewlett Packard Co. (HPQ) was up 1.10 % to $23.89. SPDR Select Sector Fund - Financial (XLF) was up 1.57 % to $16.00.
E-Mini S&P 500 Chart.
click to enlarge
Tuesday, what to expect: We maintain a bullish bias unless the E-Mini S&P 500 penetrates $1377.50. Today, we anticipate an inside to higher day. Monday's range was $1415.50 - $1392.50. The market settled at $1415.00. Our comfort zone or point of control for this market is $1402.00. Our anticipated range for Tuesday's trading is $1421.50 - $1393.50.