Thread: tsptalk's Market Talk

Another Monday morning gap up. Last week's didn't hold up so well. Here we go...




Some key earnings this week:

Tuesday - Tesla, UPS, Visa

Wednesday - Meta, IBM, Boeing

Thursday - Microsoft, Alphabet (GOOG), Intel

More encouraging action this morning and a modest decline in yields and the dollar are helping small caps lead this to start the day.

However the next 20+ points on DWCPF (S-fund) may be tougher than the 60 we've already saw last Friday's low.




The 10-year yield and the dollar are both at the bottom of their recent consolidation ranges, but both have open gaps below the range.




UPS reported earnings this morning helping the Transports to a 1.2% gain, and Tesla reports after the bell. They, and big tech in general, have been in a tailspin and will need an optimistic report to stop the bleeding. Big tech earnings could make or break this relief rally. 6 of the 7 Mag 7 report this week or next. Nvidia doesn't report until May 22.

Stocks opened mostly higher with the indices gapping up and coming back to fill in those caps already. The 2-day rebound is pausing a bit this morning as yields moved higher and back near the top of the range on the 10-year yield.




Tesla is up 12% helping the Nasdaq lead on the upside while the Dow is down modestly after a 4 day win streak.

Oil, gold and bitcoin are all down this morning.

Japan was up over 2% last night and Europe is mixed this morning.

Meta and IBM report earnings after the bell, and the PCE Report looms Friday morning and investors understand that this inflation data can make or break the relief rally.

An ugly open after Meta earnings last night and the miss on GDP this morning, which was a double whammy with growth slowing yet consumer expenditures up the most in a year, which sounds good but it's inflationary and it's pushing the 10-year yields up to a new high for the year.




The stock market doesn't appreciate the low growth, high inflation report, and Meta's issues with AI, so we are seeing a shake out and maybe a test of the recent lows.

I have mentioned that "stealth gap" that is there between Monday's close and Tuesday's low, but that is now filled (blue box) and now the main open gap is the one created this morning in red.




So we either have a shake out, gap fill, and a test of the lows, or the pullback is going to resume and the relief rally is over. Place your bets!

Why are yields up on the weak GDP? I don't know, maybe it just wanted to try to fill that open gap before coming down?