Here's a Sign of Health

 | Jan 07, 2014 | 1:35 PM EST
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Classic growth anyone?

That's what it feels like when I see PepsiCo (PEP) up $1.66, (PCLN) up $17, Pharmacyclics (PCYC) up $21 and Johnson & Johnson's (JNJ) stock going up $2 (partner of Pharmacyclics).

Nice to see Chipotle (CMG) up $5, LinkedIn (LNKD) up $2 despite a downgrade and Zillow (Z) rallying another $2.

These stocks had become the anchor to this market, the millstone, glaringly obvious as "wrong" given the selloff in bonds. This move, so pronounced, is saying two things to me:

  1. These stocks, which usually can't be kept back for that long, are advancing as we approach earnings because they will have good ones.
  2. Interest rates might be done with their run up, even if the employment number is strong.

To me, a strong number is baked into the 3% on the 10-year and you won't see a race to 3.25% That could also be why the bank stocks have stalled. They need rates at 3.25% pretty soon because they are anticipating an even bigger net interest margin than we have right now.

Watch these stocks. It's a sign of health that money's going back into them. There are too many of them out there for the market to rally much further without them.

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