Stocks Edge Higher; Dow Breaks 13,000!
Tuesday, February 21, 2012
Stock Market Commentary:
Monday & Tuesday’s Action: Stocks Edge Higher; Dow Breaks 13,000!
The stock market in U.S. was closed on Monday in observance of the President’s Day holiday. However, U.S. futures, and oversea’s markets enjoyed nice gains on Monday on renewed optimism vis-a-vis the latest bailout for Greece. On Tuesday, the Dow Jones Industrial Average topped 13,000 for the first time since May 2008. The DJIA has been up every month since October and is currently enjoying one of its strongest rallies since the March 2009 low! Meanwhile, the tech-heavy Nasdaq composite has already taken out its 2007 high and is currently sitting at its highest level since December 2000! Make no mistake about it, the bulls are clearly in control of this market as the global economy continues to recovery from the Great Recession in 2008 and 2009. In the short term, stocks are very extended to the upside and a 5-9% pullback would be considered “normal” and “healthy” for this very strong bull market.
Market Outlook- Confirmed Rally
Risk assets (stocks, FX, and commodities) have been acting better since the latter half of December. Now that the major U.S. averages scored a proper follow-through day the path of least resistance is higher. Looking forward, one can err on the long side as long as the benchmark S&P 500 remains above support (1292). Leadership is beginning to improve which is another healthy sign. If you are looking for specific help navigating this market, feel free to contact us for more information. That’s what we are here for!
