Frankly, we were surprised at the strength of yesterday’s upward trend in the Nasdaq which rose over 300 points, or 1.2%.
Frankly, we were surprised at the strength of yesterday’s upward trend in the Nasdaq which rose over 300 points, or 1.2%. With the Fed announcement coming this afternoon and (more importantly) earnings announcements from MSFT, GOOG, and NOW due after today’s close, traders had every reason to hold their fire. It’s telling, though, that futures are muted on the morning after blowout earnings from SK Hynix in Korea. Chips, for their part, are up in today’s US premarket, but there is not the broad follow-through that generally accompanies a move in that sector.
Outside of the tech space, there are trouble signs in paper. IP is down 7% in the premarket after missing on revenues and announcing a $1.4 billion write-down on its European business. Paper packaging maker SW (Smurfit Westrock) missed on earnings and revenue, citing freight and energy costs. It’s trading thinly in the premarket but is indicated down about 10%. Normally an area of the market that doesn’t draw headlines, the paper sector could be instructive in this case, as box demand can be an indicator of how much physical stuff the economy is shipping.
Even as we write, futures are tipping higher. However, experience says that traders should restrain the impulse to dive in. Keep an eye on our trading board for the outliers as setups emerge throughout the day.
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