Desire to Add Exposure Leads Indices Higher

 | Apr 25, 2017 | 10:33 AM EDT
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Bears and underinvested bulls were hoping that Monday's spike would fail to produce follow through today, but some good earnings news, positive talk about tax policy and the fact that many weren't well-positioned for the move is helping to create momentum this morning.

Like many other market players I was not well-positioned for the move yesterday, and now that the bulls are producing some solid momentum I need to add exposure. There are plenty of other folks in the same position and that is why we are seeing one-way action in the indices so far.

Breadth is 3 to 1 positive again and there are already about 750 stocks hitting new 12-month highs. The big-cap technology names are doing OK, but it's the big-cap Dow stocks that reported this morning that are leading. Caterpillar (CAT) , McDonald's (MC) D and DuPont (DD) are the leaders today, with small-caps doing well also.

I need to add some long inventory and am looking at names such as Kornit Digital (KRNT) , Broadwind (BWEN) , Calithera Bio (CALA) and TG Therapeutics (TGTX) .

Big-cap earnings plays are where the money is gravitating, but if this a real rally the strength should broaden out. The market has very good support now as buyers look for inventory. Don't be in a rush to fade this move.

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