1:05pm (EST)
The bulls are working on a 2-session win streak as they look to push the next layer of resistance. After a solid start the major averages have come off their highs but are still showing solid gains. While overseas news has been light, we did notice Fitch’s downgrade on Japan’s credit rating which reflected growing risks for Japan’s sovereign debt. Add another one to the growing list.
As far as economic news here at home, the National Association of Realtors reported Existing Home Sales rose 3.4% in April to 4.62 million versus estimates for an increase to 4.61 million. On the negative side, the Richmond Fed Manufacturing Index came in at 4 versus expectations for a print of 11.
Major earnings announcements are winding down as we look ahead to July and the next cycle but Best Buy (BBY, $18.54, up $0.37) reported their results today. The company managed to beat Wall Street’s expectations but there was nothing good about their quarter. Same-store Sales fell over 5% and revenues were lower in Europe and China.
Although shares are getting a pop, they did dip below $18 and the 52-week low is at $17.53. We said there was a chance shares could touch $20 on better-than-expected results but we have a summer-time target of $15 or worse for the stock.
We added 2 new trades this morning as we were able to get in at or below our limit prices. These trades will be short in nature as we explain in the Members Area but we are still targeting at least 50% gains in two weeks or less for both recommendations.
As we head to press, the Dow is up 49 points to 12,553 while the S&P is showing a gain of 8 points and is at 1,324. The Nasdaq is advancing 10 points to 2,857.