The Bank of England held steady, and although Goldman says the US Fed will ease we see that as a bit of a long shot today. Is it possible? Yes. But we think the probability is low as the Fed must keep some firepower back to use if things get worse. If they move towards more dovish language and hint at some sort of QE3, we feel like that would be enough for today.
In economic news today in the US investors can look for the FOMC Rate Decision (Consensus 0.25%), the MBA Mortgage Index, Crude Inventories and then of course Chairman Bernanke's press conference. All of this before a heavy Thursday of economic numbers. There should be choppy trading leading up to the Federal Reserve news and press conference, and investors should be ready to act on that news if they have built up trading positions over the past few days.
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Looking at Asian markets we see markets are higher:
All Ordinaries - up 0.23%
Shanghai Composite - down 0.34%
Nikkei 225 - up 1.11%
NZSE 50 - down 1.02%
Seoul Composite - up 0.65%
In Europe markets are higher:
CAC 40 - down 0.43%
DAX - up 0.13%
FTSE 100 - up 0.18%
OSE - up 0.41%
Sirius XM (SIRI) had the day which we had been looking for. Shares broke out, and it was to the upside. On volume of 55.7 million shares, Sirius rose $0.075 (4.09%) to close at $1.91/share. The stock had traded as high as $1.92, the level we said it needed to take out to really break out, and we will be very interested in the price action today to see if investors can get the shares over that level. Much of that might be on the Fed's shoulders, but we think that the price needs to get over that level to sustain this move upwards.
Apple (AAPL) was a bit of a disappointment during yesterday's rally as shares languished behind the market's gains. Volume was extremely light at 12.9 million shares, which has become the normal as of late. We did notice that the shares could not take out the $590/share level as they backed off right after hitting that price. We think that this will move above the $600/share level, and as it catches fire, it will catch the attention of market participants. It is a momentum stock as well as a darling, so it maintains its price relatively well and get a little extra 'umph' when it moves higher. Shares finished at $587.41/share in trading yesterday as shares rose $1.63 (0.28%).
Facebook (FB) has been one of those stocks which people hated, and rightfully so after getting punished during the IPO. Since bottoming out the shares have moved strongly higher, continuing the trend up yesterday. Shares closed at $31.91/share up $0.50 (1.60%) on volume of 30.8 million. It will be interesting to look back at this one 12-18 months from now and seeing if the sell-off was due to negative press after the IPO and whether this goes on a post-IPO run like Google did. Remember both were said to be fully priced.
Sprint (S) has been trading above the $3/share level for a few trading days and the stock has been recovering from the lows set earlier in the year and moving through levels not seen in many months. The stock is looking strong here, and the chart was solid looking yesterday as shares closed at the high for the day. With the pricing of the plans that the industry is switching to, Sprint could very well pick up new customers. On this we admit we are looking at adding to their customer ranks personally. Good news for Sprint and good news for our wallet. Shares finished up $0.07 (2.27%) to close at $3.15/share.
Arena (ARNA) continues its upward march, although with the move yesterday it may be running out of steam. The shares finished at $9.70/share having risen $0.32 (3.41%) on high volume of 46.2 million shares. We say that it appears we could be running out of steam here is due to the pullback off of the day's highs and the amazing run we have witnessed here recently. All without a pullback we might add. Shares traded up above the $10 level, but it was after hours and we place little faith in that type of trading, but it would appear that the shares will make another run at the $10 level tomorrow.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.