- Not a lot of action
- Not a lot of tension
- Not a lot of anything
This market has been dragging today as investors grapple with the speed and velocity of a rally that gets stronger on bad news. There is a little bit of consolidation but not the kind one would expect after such a sharp spark. If the Dow Jones Industrial Average was off 100-points it wouldn't raise any red flags. Be that as it may, the market hints at a last minute rally into the close. Why not? One thing is for sure, sellers aren't selling even if buyers need to chase big moves. The motivations for buyers are pretty clear....this train has left the station. Although there have been periodic scares for the market, the fact is that most holders of stocks at this point are stubborn or greedy, but they aren't sellers. In fact, I think that the few times the market hinted at a full-blown reversal to the downside it was investors mostly late to the game that blinked.
Of course, the market is getting its cues from a variety of sources, and I think the fact there wasn't a sell-off on Friday set the tone for yesterday's move, which of course got a big boost from the G-20 communiqué. It was great news to equity investors that easy money will continue to flood the system and at some point, it may even reach Main Street.
In the meantime, a slight nudge in small business optimism couldn't provide a spark for the stock market. One thing that doesn't bode well is breadth:
- * Advancers: 998
- * Decliners: 1,983
There was disturbing news from Electronic Arts (ERTS) and Sprint (NYSE:S) as both companies announced additional job layoffs. So add another 1,500 and 2,500 names, respectively, to the list of victims of this recession. If it makes anyone feel better the share prices of both companies are lower today.
Written by Charles Payne, CEO and Principal Analyst of Wall Street Strategies (wstreet.com) providing independent stock market research to over 30,000 subscribers, in more than 60 countries. Mr. Payne is a regular contributor to the Fox Business and Fox News Networks. For more information about Mr. Payne, please refer to the company’s website www.wstreet.com.