Two-Tier Market – Small Companies to Dominate ?

Investor's first read an edge before the open

DJIA: 17,880
S&P 500: 2,0662,080
Nasdaq  Comp.: 4,8864,917
Russell 2000:    1,260
Tuesday, April 7, 2015   9:09 a.m.

CONCLUSION:

   The market successfully tested critical support yesterday and rebounded impressively to keep its Feb. – Mar.  consolidation range (DJIA 17,600 – 18,200; S&P 500: 2,040 – 2,115) intact, now setting the stage for an upside breakout.  The Nasdaq Comp. is positive, but  the small company Russell 2000 is close to an upside breakout confirming my conclusion that the Street is opting for greater risk.

    Today’s support is DJIA 17,847 (S&P 500: 2,076; Nasdaq Comp.: 4,906). The bullish case improves with a break above DJIA: 18,010; S&P 500: 2,090; Nasdaq Comp.: 4,950.  

KEY FACTORS: 

Private sector employment (new hires) reported Friday plunged to 129,000 in March from 210,000 in February (revised). 

-Economic  indicators reported last week were mixed.

-Q1 earnings for some companies to suffer from U.S. dollar’s strength and plunge in

  oil prices. Impact could be felt for at least two quarters for some companies.
-Market still keyed on the Fed and it’s first bump up in interest rates, which with a slight softening in recent economic reports looks like it may happen later rather than sooner.

Concern that the U.S. economy is beginning to slump.

COMMENTS:

The Street is in a quandary and doesn’t  know what to do. Earnings suck, international economies are on the verge of a serious recession, the Street welcomes bad economic news here, so the Fed won’t raise interest rates any time soon, but where else can one put their money ?  It all smacks of great opportunity, but also great risk,  It is what it is, so we must deal with it.  IMHO, there is an enormous amount of outright manipulation of stock prices and earnings period is where a lot of it takes place. Q1 earnings will soon be reported  –  #@*&))#

Note: Source of economic data

For a weekly economic calendar and good recap of  indicators, go to mam.econoday.com.
George Brooks
Investor’s first read
A Game-On Analysis, LLC publication

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Note: I discontinued my daily – before – open publishing of Investor’s first read on November 5, 2014, after 6 years (1.600 posts).  Future publishing will be on a less frequent basis and not always before the market opens. In the interim, I will publish as I see necessary as I craft a new format.

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Investor’s first read, is a Game-On Analysis, LLC publication for which George Brooks is sole owner, manager and writer.  Neither Game-On Analysis, LLC, nor George  Brooks  is  registered as an investment advisor.  Ideas expressed herein are the opinions of the writer, are for informational purposes, and are not to serve as the sole basis for any investment decision. References to specific securities should not be construed  as particularized or as investment advice as recommendations that you or any investors purchase or sell these securities on their own account. Readers are expected to assume full responsibility for conducting their own research pursuant to investment decisions in keeping with their tolerance for risk.

 

 

 

 

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