While the equity indices have been trending slowly upward since breaking out on April 1, it has not been an easy market for most traders. The action Tuesday was a good example.
The indices jumped at the open on good economic news and some trade optimism, but that was the high of the day. The action went dead intraday and then a late sell program hit and the opening gap in the SPDR S&P 500 ETF (SPY) was completely filled.
Breadth was slightly positive by the time the market closed, although many of the high-growth and momentum names were hit in the last hour of trading.
The chaotic sell program in the last hour may have been triggered in part due to the settlement of the bitter patent dispute between Apple (AAPL) and Qualcomm (QCOM) . Shares of Qualcomm roared higher on news that the settlement could be worth $2 in earnings per share. Apple held steady as the deal may help the company enter the 5G market faster.
That news may have triggered some rotational action in semiconductors and other technology stocks as there were plenty of folks looking to reposition.
The Netflix (NFLX) earnings news hit after the market close and the stock is trading lower after-hours. Second-quarter estimates were cut and revenue growth is expected to be flat. The company beat estimates, but that guidance is going to cause some issues.
Some stocks are working, however, this is a very tricky market right now with low volume, random moves but a positive bias. The good news is that both Qualcomm and Netflix may help to stir up some stronger emotions.
Have a good evening. I'll see you Wednesday.
