After the stumble on the Fed yesterday, we have some bounce action this morning but there is a concern that it may not be that easy to shrug off the shift in sentiment about the Fed this time.
The good news is that there appears to be a shift in focus to stock picking as market players focus more on opportunity in individual stocks rather than market direction trades. With small-cap earnings season in full swing over the next two weeks there are some nice pockets of speculative action.
One group that is particularly active right now is solar energy, Invesco Solar ETF (TAN) . I noted Enphase (ENPH) yesterday and SunPower (SPWR) is today's big winner in the group. I'm watching Sunrun (RUN) , which announces earnings next week, very closely.
Bulls are hoping that there will be some dovish comments from other Fed members once the Fed quiet period ends today. This market desperately wants to believe that a series of rate cuts are coming and will leap at any hint that is the case. Jerome Powell has been a very ineffective communicator but other members seem to be inclined to clarify his comments very quickly.
I'll be digging deeper for some small-cap earnings plays. This solar group action is a good sign for stock pickers.
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Valuations for many enterprise software firms remain rich. But like chip companies, their earnings reports generally haven't done much to spoil the fun.
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