Markets Building Upside Momentum

Stocks began the week on a positive note, as major market averages posted steady gains ranging from +0.45 for the Dow Jones Industrial Average (^DJI) to +1.7% for the Russell 2000 (^RUT).

Market Internals continue to impress, with Up Volume at 4X Down Volume and advancing issues beating decliners by better than 3½ to 1. While these numbers are a far cry from the epic stats we had Friday on market breadth, we would have welcomed these stats in a heartbeat anytime during the second half last year.

While gains were tempered by some afternoon selling, the rally was clearly broad in scope, with participation from many sectors.

Oil stocks were aided by crude hitting its best level in 3 weeks.

Financials continue to get attention from investors attracted to their dividend yield and well below average p/e valuations.

Retailers are enjoying the afterglow of the holiday spending season, clearly benefiting from gas prices hitting 4 year lows during the peak of the holiday shopping season.

Thank you, President Donald Trump!

Never mind the travesty of past generation icons Sears and JCPenney. While these franchises died years ago, life goes on as Craftsman Tools are readily available at Lowes and Ace Hardware.

The Technology space deserves kudos for shrugging off red numbers from Apple Inc. (^AAPL) and Alphabet Inc. (^GOOG), as the Nasdaq Composite (^IXIC ) settled with gains of better than +1%.

It’s worth noting that overnight Samsung is giving cautious guidance on phone sales, similar to what we heard from AAPL last week. Keep in mind that we’re into day 2 of CES week in Las Vegas, and there will likely be a steady stream of product announcement headlines as the week wears on.

The Early Line:

Investors appear not to be deterred at all by yesterday’s afternoon selling that paired the day’s gains nearly in half, as early trading in stock index futures are pointing toward gains of close to +1%.

This morning the NFIB Small Business Optimism gauge for January held nearly unchanged at 104.4. We’ll take that, thank you very much. At 10:00 AM we’ll get the JOLTS report on job openings.

Tomorrow afternoon we’ll get the release of the minutes from the December FOMC meeting, followed by a full calendar FED speakers to fill out the rest of the week.