Don't get me wrong, I'm not waving a bearish flag and looking for a huge correction today (I'm actually thinking crash when the whole thing falls apart, lol) but it looks like we're in for further consolidation, which in the case of yesterday still led to further intraday gains. Ultimately, if more serious selling comes into the picture Dow 13,000 and then 12,900 are key areas of support given how they were launchpads for broader participation. It's the recent 'broader participants' and what their staying power that has me quite intrigued.
Just for fun, here's a chart of the S&P 500.
While the chart is clearly bullish notice the steepness of the recent surge from the lows of this year. Also notice what happened (Oct 2005) the last time the S&P slammed down through its 50 day moving average only to bolt back above it in a few months: a similar steep uptrend (into November 2005). These steep upward moves don't last forever and it will be interesting to see if the market becomes more range bound somewhere above 1500. I suspect that with the the type of momentum underway, the 'go away in May' rule could be scuttled and that we're headed for the old all time highs up at S&P 1550, unless something big blows up somewhere in the world, or we get an even great dose of bad economic reality.
The star performer of the day is going to be.... Baidu.com (BIDU). The Chinese web portal company posted better than expected earnings and it's up a stupendous $27 a share.
Microsoft posted its results and its stock is managing a 5% gain. Revenue from Vista, Office boost Microsoft sales, profit. Smith Barney upgraded MSFT to Buy from Hold with a $36 target. CIBC upgraded to Sector Performer as well.
Broadcom fell on its face. Broadcom earnings dip 48 percent. UBS downgraded it to Neutral from Buy with a target of $39. AG Edwards reiterates a Buy saying Motorola (MOT) is impacting the company and 2H will be better (promises, promises). AGE cut its price target on BRCM to $39 from $41.
Gross Domestic Product comes our way at 8:30. Obviously, it could be a further day at the races, or a real wet blanket. More after the report. Q1 growth expected at 1.8%. Yep, 1.8% annual growth with the stock market above 13k., pretty cool, huh? Pricing components will also be closely scrutinized.