All of This Solid News Matters

 | Apr 02, 2014 | 7:00 AM EDT
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Maybe, when we consider all of these stocks that are going up because the economy is gaining strength, it makes sense they're going up? When you are selling cars at a 16.4 million seasonally adjusted annual rate when prognosticators are looking for 15.8 million, as we found out Tuesday from General Motors (GM), that shows innate strength -- the kind of innate strength that says rates should be going higher. When GM sales increase by 4%, even as it had been a pretty safe bet that they wouldn't increase at all, you have a sign that things are indeed humming.

Don't forget that, when Toyota (TM) had its recall problems back in 2010, sales fell 16% in the month that the bad news was announced -- and I could argue, in retrospect, that this one's much worse for General Motors. As Ford said on its call, last month started out OK, upticked mid-month and was "very strong" at the close.

Plus, the breakdown on the purchasing managers reports was very strong: new orders accelerating, inventory contracting, all in the right direction. Then add in a terrific regional report from the Texas Federal Reserve, and it adds up to 100% good news for the economy yesterday.

All of this, moreover, came on top of some very strong truck-build numbers that were surprising in their own right.

I think all of this strong economic news matters a great deal, because the market is set up for good news. The stocks that have been running are stocks that need a stronger economy, and while we had a snap-back of the former leaders yesterday -- one that I think can continue -- it was the recovery names that need this kind of economy to continue that can still lead us.

Last night, when I was signing books at Barnes & Noble, I caught a number of inquiries about how much longer these big-capitalization tech companies, the old dogs, are going to continue going up. When I hear data like yesterday's data, I can see the move continuing right into the numbers. Plus, at this pace, I can't imagine that interest rates can stay as low as they are right now, and that could set up the market for the right kind of yield curve when the banks report.

Industrials, financials, techs: All are making sense, based on the data.

The only thing holding back the market? These are American data, and we are dealing with international companies. But until we hear the actual earnings reports, I bet people will extrapolate and continue to take the industrials higher based on all of this good macroeconomic news.

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