Very well-timed headlines about the resumption of trade negotiations between China and the U.S. spiked the market a few minutes before the opening bell. A cynic might view the timing as manipulative but traders used the opportunity to make some quick sales.
The indices are still in positive territory but well off the early highs. Breadth is two to one positive but both new 12-month highs and lows are around 50, which is a good indication of the lack of strong momentum.
The FAANG names are not bouncing well at all and that is a concern. There is quite a bit of worry about the Apple (AAPL) earnings report tonight and that can be seen in the reluctance to buy the dips in other FAANG names. The risk that a mediocre Apple report will trigger another wave of selling in the group is high.
The company reported very good earnings this morning and is up on the news. Earnings per share was $0.42 vs $0.10 in the same quarter last year and revenues grew 252% from a year ago. The company is expected to see EPS growth of nearly 300% for the full year 2018 and 50% in 2019, yet trades with a trailing P/E of 14.
Oil is weak today but the sector is on my shopping list. I'll be adding to my SOI position and will be watching for W&T Offshore (WTI) to find some support soon.
This remains a very tough market for individual stock-pickers as there is little leadership and even less momentum. I'm taking a longer-term view with some oil names but otherwise I'm scalping a few things intraday. There just isn't any good reason to build larger positions right now.