The indices reversed about 90 minutes into trading and wiped out early gains. However, they then spent the rest of the day recovering and were nearly back at the highs by the market close.
In addition to the quick recovery from the intraday reversal what was most impressive Monday was breadth that was almost two-to-one positive. There was broad strength and some new leadership in the form of the banks.
The strength in bank stocks in front of the Fed meeting this week is an indication that there isn't real worry about an inverted yield curve. The only time the market has tended to run into trouble when the Fed is dovish is when the yield curve inverts. That is often viewed as a sign that a recession is looming but the recent concerns about economic growth have been set aside.
If the bears are looking for something to growl about about they can focus on the complacency that seems to have taken hold. There was no real concern when the indices dipped and the fact that many stocks are extended isn't producing any dramatic profit-taking.
I did lock in some gains Monday and didn't do too much new buying, although there is plenty of healthy action on my screens. When we have this sort of trading action in individual stocks it is hard to be negative.
Have a good evening. I'll see you Tuesday.
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