The market has been bouncing around on news flow about the Ukraine crisis, but there is some pentup buying power and it was put to work on Wednesday when the minutes of the last Federal Open Market Committee (FOMC) meeting were released.
There wasn't anything particularly positive about the minutes and conditions have changed quite a bit in the interim, but events such as this often serve as a catalyst for market players who are looking to make a move. Despite negative news flow there appears to be some persistent support in various areas of the market, and that is what caused the strength Wednesday afternoon.
Unfortunately, the Ukraine situation remains very unclear, and we are going to have a steady diet of tweets and news headlines about Russian army movement and manipulative remarks from world leaders. The potential for a Russian invasion is out there and the market is going to stay contained until something changes.
Even though the indexes are held hostage by interest rates and Russia, there continues to be better trading action under the surface of the market. Stock picking is working better and charts are developing. Many small-caps, growth names and biotechnology stocks have found good support and are developing tentative uptrends.
While this certainly is not a roaring bull market, there is a reversal of the action that dominated over the past year where strong indexes covered up very broad weak action. The indexes are struggling now, but the underlying action has improved and is in good shape for further improvement.
We have a little early pressure on some of the headlines about Ukraine and there are a few big movers on earnings news, but it is looking like an environment that may work for selective stock pickers.
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