Monday, March 22, 2010
The major averages ended higher as the dollar fell after Congress passed the historic health care bill. As expected, volume contracted compared to Friday’s options inflated levels on both major exchanges. Advancers led decliners by nearly a 2-to-1 ratio on the NYSE and the Nasdaq exchange. There were 45 high-ranked companies from the CANSLIM.net Leaders List that made a new 52-week high and appeared on the CANSLIM.net BreakOuts Page, higher than the 37 issues that appeared on the prior session. New 52-week highs again overwhelmingly trumped new lows on both exchanges.
The Finances Of The Health Care Bill – Explained:
Late Sunday night, the US House of Representatives passed the historic health-care bill which will allow uninsured Americans to get medical coverage and add a whopping $940 billion in debt over the next decade. To pay for the plan, in 2013 the government wants to initiate new Medicare taxes on individuals who earn more than $200 thousand dollars a year and joint filers who earn more than $250 thousand dollars a year. Taxes will increase to 2.35% from 1.45% and a new 3.8% tax on unearned income such as dividends and interest will be created. Finally, there will be an excise tax of 2.3% on sale of medical devices.
Market Action- Confirmed Rally: 1 Distribution Day
The fact that there has only been one distribution day since the FTD bodes well for this nascent rally. It is also a welcome sign to see the market continue to improve as investors digest the latest round of stronger than expected economic and earnings data. Remember that now that a new rally has been confirmed, the window is open to start buying high quality breakouts. Trade accordingly.
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