Welcome Any Pullbacks as Buying Opportunities
by Sam Collins | July 10, 2013 2:46 am
Despite a cut in the global growth outlook by the International Monetary Fund, U.S. stocks soared again Tuesday. The Dow industrials rose for the fourth straight day and the Nasdaq closed at a 12-year high.
Investors continued to buy both growth and cyclical stocks. The Russell 2000 small-cap index rose 0.9% to its third consecutive closing high. And the Dow Jones Transportation Average jumped 2.3%, with all 20 of its stocks posting gains.
At Tuesday’s close, the Dow Jones Industrial Average was up 76 points at 15,300, the S&P 500 gained 12 points at 1,652, and the Nasdaq rose 19 points to 3,504. The NSYE traded 691 million shares and the Nasdaq crossed 403 million. On the Big Board, advancers led decliners by 2.9-to-1, and on the Nasdaq, advancers were ahead by 1.5-to-1.
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The Nasdaq has been on a tear since its June 24 low and seems destined to punch through the high at 3,532 before any consolidation occurs. Support now rests at the 50-day moving average at 3,429. Its MACD is on a strong buy signal.
After appearing to struggle with its 50-day moving average, the Dow transports had one of their best days of the year. This should make economists happy since the index is often a harbinger of economic conditions six to nine months down the road.
Conclusion: All indicators are positive as we enter Q2 earnings season. However, this plus several days of Fed talk could slow things down somewhat.
It was Chairman Ben Bernanke’s last review of Fed policy that led to a sharp sell-off and regional presidents scrambling to explain what they thought he meant while the stock and bond markets went ballistic.
This week’s address by the chairman will no doubt be more measured, perhaps even dovish, but even “Fedspeak” and higher interest rates have yet to harness the bull. Thus, any pullbacks should be considered good buying opportunities.
Today’s Trading Landscape
To see a list of the companies reporting earnings today, click here[3].
For a list of this week’s economic reports due out, click here[4].
- [Image]: https://investorplace.com/wp-content/uploads/2013/07/07-10-13-nasdaq.gif
- [Image]: https://investorplace.com/wp-content/uploads/2013/05/chart-key.gif
- click here: http://online.wsj.com/mdc/public/page/markets_calendar.html?mod=topnav_2_3024
- click here: http://www.briefing.com/Investor/Public/Calendars/EconomicCalendar.htm
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