The gap-up open is holding so far, although consumer sentiment and Chicago PMI numbers were somewhat weak. That is being offset by better-than-expected consumer spending and some takeover news. The market is a bit technically overbought, too, but that doesn't seem to matter.
But it isn't the news flow that is the main market driver right now. It is the price action. The fear of being left out is overwhelming big-picture concerns. Rate hikes may be a reason to worry but this market isn't in the mood to worry about these things right now.
As StevenO noted in my blog, the discounting mechanism doesn't seem to operate like it once did. While conventional wisdom is that the market looks ahead a number of months and discounts major events, that doesn't appear to be the case these days. Perhaps that is due to a long history of poor predictions but the lesson is that trying to anticipate negative reactions is very difficult.
The S&P 500 looks like it is on a mission to break above the April 20 high of 2111. When a level like that is so obvious it generally serves as a magnet and the bears will stand aside until it is breached. A breakout like that can easily fail but chances are high it will be taken out first.
I'm trying to build some new inventory, as I've taken profits on names such as Celator Pharmaceuticals (CPXX) and Yirendai (YRD). My Stock of the Week, Evolent Health (EVH), is showing a little spark and last week's pick, Acacia Communications (ACIA), is still acting well. The action is positive but new buys aren't easy.