Can the Nasdaq’s Steep Advance Continue?

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Most of Thursday’s focus was on the Nasdaq, which rose 0.4% and closed just 0.3% shy of its all-time closing high. The S&P 500 and Dow industrials gained as well, each up 0.5%.

Stronger-than-expected housing data contributed to investors’ optimism. Existing home sales increased 6.1% in March from February. The National Association of Realtors reported that the gain was the highest since September 2013. This followed two months of bad data due to harsh winter weather. The median sale price for a previously owned home rose 7.8% from a year ago to $212,100.

All 10 sectors of the S&P 500 registered gains with the Technology SPDR (ETF) (NYSEARCA:XLK) the frontrunner, up 1.1%. Leading the charge higher was Broadcom Corporation (NASDAQ:BRCM), up 5%, and VMware, Inc. (NYSE:VMW), up 6.5%, with both companies beating quarterly earnings estimates.

Crude oil for June delivery fell 0.8% to $56.16 a barrel. Gold slid to a three-week low at $1,186.90, and the U.S. dollar rose slightly against the euro.

At Wednesday’s close, the Dow Jones Industrial Average rose 89 points to 18,038, the S&P 500 gained 11 points at 2,108, the Nasdaq was up 21 points at 5,035, and the Russell 2000 added 1 point at 1,265.

The NYSE’s primary market traded 754 million shares with total volume of 3.3 billion. The Nasdaq crossed 1.7 billion shares. On both major exchanges, advancers outpaced decliners by about 1.2-to-1.

Nasdaq Chart
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Chart Key

The Nasdaq closed a mere 7 points short of March’s high and is in view of its all-time closing high of 5,048 from March 2000. The 50-day moving average has acted as support since the March low at the support line at 4,815. Since then, the Nasdaq has tracked that moving average, which has been rising at a 45-degree angle.

The question is, can it maintain such a steep advance and jump to a new all-time high?

Conclusion

A source that I regularly follow said that the often-expressed view among The Street is that this bull market, at six years old, is long in the tooth and should shortly end. However, the market can outlast all of our combined resources and then some, doing what it does best — moving against the majority opinion.

The research team at Bank of America/Merrill Lynch pointed out that bull markets have a life span of 2-9 years and, “Growth, sentiment, and other factors matter far more than an arbitrary time period.”

Returns from the retail and housing industries predict that spring/summer versus winter comparisons could be strong. Thursday’s favorable housing data could be just the beginning of even better returns.

But, as usual, it’s not as simple as that since the market has a habit of treating good news badly as pundits go for the headline Federal Reserve quotes about rising interest rates when economics turn favorable.

I’m still long-term bullish, but the daily and weekly fluctuations are hard to predict.

Today’s Trading Landscape

To see a list of the companies reporting earnings today, click here.

For a list of this week’s economic reports due out, click here.


Article printed from InvestorPlace Media, https://investorplace.com/2015/04/daily-market-outlook-can-nasdaq-steep-advance-continue/.

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