After a bout of selling this morning, it was another day of chugging higher. Breadth improved to a bit better than flat, and the gains in the indexes weren't anything dramatic, but anyone who has been looking for a dip sure isn't get much.
We were well set for a "sell the news" reaction to earnings reports, and today's action raises those expectations even more. The danger of a straight-up market is that it prices in all the possible positives and doesn't take much to disappoint. This market won't be forgiving if a company doesn't post strong numbers and issue good guidance.
INTC reported tonight and both earnings and revenues are solidly ahead of estimates. The stock has traded up some 90 cents. The big test: Can it continue to run, or will traders start taking some gains into strength?
I'm not particularly surprised at the initial positive reaction. This is a market that needs to spin all news as exceptional to keep on running. There is no room for negatives. As long as expectations are exceeded, the bears will be kept at bay.
The analysts should celebrate this report tomorrow and raise their estimates, and we'll have a good test to see if this market can keep on chugging along without a pause.....