9:00am (EST)

The Dow and S&P 500 closed at record highs on Tuesday but the small-caps and Transports took another hit.  There are some important economic reports due out this morning so let’s go over the numbers real quick.

The Dow gained 89 points, or 0.6%, to end at 14,662.  The blue-chips reached an intraday all-time high of 14,684 and is less than a half-percent away from triggering our near-term target of 14,750.

The S&P 500 advanced 8 points, or 0.5%, to finish at 1,570.  The index kissed 1,573.66 but had trouble clearing the intraday all-time high north of 1,575.  The bulls will need to clear this level on the close if they have plans to reach 1,600.

The Nasdaq jumped 16 points, or 0.5%, to settle at 3,254.  Tech traded up to 3,267 and we are looking for a close above 3,275 as confirmation a run to 3,300 is coming.  The index held the 3,250 level but failed to make a higher high from last Thursday and Monday.

The Russell 2000, dipped 5 points, or 0.5%, to close at 934.  We have talked about the break below 940 and how the small-caps could lead a market reversal so this situation needs to be watched.  Meanwhile, the S&P Volatility Index ($VIX, 12.78, down 0.80) dropped 6% and closed below 13.50.  This was mildly bullish.

Futures were mixed for much of the night but have improved ahead of this morning’s ADP Employment report that is due out shortly.  The consensus is for a gain of around 200,000 jobs but we are expecting numbers in the 160,000-180,000.  While the headline would be disappointing to most, a lower number would actually be good for the market, as it would help keep quantitative easing at full speed.

As we head to press, here is how things are shacking up:  Dow (+6); S&P 500 (+2); Nasdaq 100 (+3).  There could be a major swing in the futures if the report is viewed as positive or negative so we have planned for a little volatility this morning.

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