The market surged higher today with the S&P logging healthy gains of .65% but the real stars of the show were the Russell 2000 and NASDAQ gaining 2% and 1% respectively. As readers of our newsletter know, we have been concerned with the divergence in the market between the large cap indices (Dow and S&P) and small cap and technology indices (Russell and NASDAQ). While the S&P charged to new highs, the small caps and technology companies have been in a downtrend at worst or a consolidation at best. That may have started to change today.
Early this morning, the ECB (European Central Bank) announced several new initiatives designed to spur the Euro Zone markets. Some of the measures were extraordinary and certainly got the attention of traders in the US. With the prospects of a healthier European market, the US market was off to the races. We will see if today's euphoria has sticking power as tomorrow morning we get the much anticipated jobs report. The market is currently overbought so a little bit of profit taking is in order. We will see in due time if this rally can continue but we continue to see warning signs that all might not be as rosy as it seems. We are not alone in our thinking...
FEAR OF A STOCK MARKET DECLINE IS ALMOST NON-EXISTENT
Welcome to the extended version of the BAM Market Note. We are not bloggers by nature but have had clients and friends inquire about our thoughts on the market in between our newsletters. The number and content of posts will likely be determined by the conditions of the markets and the interests of our readers. We would greatly appreciate your feedback and comments.
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