The recent split performance of the major equity indices has yet to show signs of abating, with most of them in near-term bullish trends.
All the indices closed higher Friday with positive internals on the NYSE and Nasdaq.
Most closed at or near their intraday highs except for the Nasdaq Composite and Nasdaq 100 closing near their midpoints as they continue their recent underperformance.
The S&P 500, DJIA, Dow Jones Transports, MidCap 400 and Value Line Arithmetic Index posted new all-time closing highs.
The Nasdaq Composite did manage to close above its near-term downtrend line while flashing a bullish stochastic crossover signal and turned neutral from negative with the Russell 2000 staying neutral.
The Nasdaq 100 (see below) closed at its downtrend line and remains negative.
Positive market breadth, however, did not alter the current cumulative advance/decline lines for the All Exchange and Nasdaq that remain negative with the NYSE's positive.
The McClellan 1-Day Overbought/Oversold oscillators remain neutral (All Exchange: +7.89 NYSE: +27.78 Nasdaq: -8.7).
Sentiment indicators were, once again, little changed and remain at somewhat cautionary levels. The Rydex Ratio (contrarian indicator) measuring the action of the leveraged ETF traders is still in bearish territory at 1.27.
Last week's Investors Intelligence Bear/Bull Ratio (contrary indicator) saw a drop in bullish sentiment at 16.5/59.2 as did the AAII bear/bull ratio at 23.6/49.7. However, both of those sentiment contrarian indicators remain in bearish territory.
The Open Insider Buy/Sell Ratio remains neutral at 25.9 as insiders continue to sit on the sidelines.
Valuation still appears extended with the forward 12-month consensus earnings estimate form the S&P 500 from Bloomberg rising to $188.86 per share. This leaves the S&P's forward P/E multiple at 22.4x, down from its recent peak of 22.9x. The "rule of 20" still finds fair value at 18.4x. The valuation spread has been consistently wide over the past several months while the forward estimates have risen rather consistently.
The S&P's forward earnings yield dipped to 4.46%.
The 10-year Treasury yield closed at 1.58%. We continue to view 1.55% as support with 1.63% as resistance.
Most of index charts are in near-term bullish trends, while data still suggest we maintain our near-term "neutral/positive" macro-outlook for equities.