9:00am (EST)
Yesterday was a big win for the bulls as we often look for market clues to see if the tide is turning. Following Friday’s sell-off nobody wanted to be long because of the Greece news but we already told you the market was aware of it.
Monday’s $145 billion bailout for the country was the relief rally we mentioned in Sunday’s Weekly Wrap. If the Dow would have suffered a triple-digit loss the bears would have been in the driver’s seat and we would be talking about key support levels.
That’s not the case as the Dow surged 143 points, or 1.3%, to close at 11,151. Unlike Friday when all 30 blue-chippers fell, 29 out of 30 ended higher on Monday with the Lonesome Loser being Alcoa (AA, $13.15, down $0.28). Yes, we were making a Little River Band reference…
The S&P 500 matched the Dow as it popped 16 points, or 1.3%, to close above the 1,200 level at 1,202. We will need to see a run past 1,220, first, if we are going to make a stab at our targets of 1,250-1,275 for the index.
The Nasdaq rocked it out by adding 38 points, or 1.5%, but fell just shy of the 2,500 level and closed at 2,498. If the index can get back above this level then it could easily pop to 2,550-2,600 on any given day which are our near-term targets.
We still have to watch for the downside objectives because futures are pointing towards a lower open this morning. We mentioned how we could also be range bound so we wanted to update this one more time as we head towards Friday’s unemployment numbers.
Turning our focus to earnings, Beazer Homes USA (BZH, $6.88, up $0.31) reported a profit for the current quarter after the close last night. Yep, you heard that right.
The company said it earned $5.3 million, or $0.09 a share, versus a loss of $115 million, or $2.97 a share, in last year’s quarter. Revenue came in at $198 million as the homebuilder completed 852 home sales, a year-over-year increase of nearly 6%. New home orders jumped 50% to 1,673.
Wall Street was expecting a loss of $0.62 a share on revenue of $191 million. This was good news although shares are down 6% in pre-market trading.
We mention this as well because we said the key to any sustained rally would be better housing numbers and an improving unemployment picture…
Another company we are watching is The Boston Beer Company (SAM, $58.63, up $1.62) which we have mentioned inside our Members Area a few times. Although we are not stock traders, these are shares we wished we would have picked up in the mid-$40’s back in February. We were looking at an option trade but there wasn’t enough liquidity for us to go long.
This is our favorite time of the year as the company makes its Sam Adam’s Summer Ale available for drinking. It also one of the last few American breweries you can buy stock in.
Boston Beer reports on Wednesday and we have a feeling glasses could be raised high if shares can break $60 on a good earnings report.
As we head to press, Dow futures are down 57 points to 11,045 while the S&P 500 futures are off by 8 points to 1,190.. The Nasdaq 100 futures are lower by 15 points to 2,012.
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