(By Jordan Kahn) Stocks followed the overseas weakness and opened lower, but immediately bottomed and so far look to be staging a solid turnaround day. We could use a strong day where the markets close at their highs.
There are still a few earnings reports trickling in. Some stocks on the upside after reporting include HD. KORS, and TJX to name a few. But earnings season is winding down.
The weakness started last night in Asia. China fell -1.5% last night. Japan reported a -4.1% drip in industrial production.
Europe is also lower across the board this morning after the Eurozone meeting came up with few results and the decision regarding the next tranche of Greek aid will be delayed. There is still lots of disagreement. EU Pres. Juncker said Greece would be given two more years to get to 120% debt to GDP. But IMF Director Lagarde publicly disagreed and said that the year 2020 is a more appropriate target. Separately Germany's ZEW Economic Sentiment came in at -15.7, well below expectations of -9.8.
[Related -Ford Motor Company (F) Q2 Earnings Preview: Light on the Top Line?]
There were no big economic releases in the US this morning.
The dollar is a bit higher today, and commodities are flat to lower. Oil prices are pulling back to $85 and gold prices are a bit lower near $1728.
The 10-year yield is holding near 1.60%. And the VIX is down another 3% after a big down day yesterday. It is currently at 16.20 and sitting on its 50-day average.
Trading comment: I have been looking for an opportunity to get longer for a trade, but yesterday the market once again finished on a weak note. I don't want to add any long ETFs until I see the market close at its highs for the day. Maybe today will be that day. The market is short-term oversold looking at a variety of technical indicators. The SPX has also been hovering around its 200-day support for a 4th day and could be poised to bounce. So that's what we are watching.