Last week's strong market action continued with a break out to a new all-time high. Breadth was solid, with about 4,700 gainers to 2,700 decliners, and the number of stocks at 12-month highs expanded to 600, which is respectable, but not exceptional.
Most notable Monday was that the indexes stayed in a narrow range for most of the day, without any major chasing. There was enough "fear of missing out" to provide support, but not enough to cause panic buying. With some big earnings reports coming up, it isn't too surprising that there is some hesitance at this point.
Alphabet (GOOGL) ran up sharply in front of its earnings report, and is now trading down slightly, in line with revenue numbers and an earnings per share miss, but there are other positive metrics that are preventing a more aggressive selling response.
Another report of interest tonight is Beyond Meat (BYND) , which earned 6 cents vs. estimates of 3 cents. Despite the fact that the stock is still widely expensive, it is only trading down about $5 on the better-than-expected numbers.
There are more big reports coming up this week, plus the Fed interest-rate decision on Wednesday. Conditions are ripe for some selling into the technical breakout of the S&P 500, but this market seems to confound the bears every time they have an attractive setup.
There continues to be some good action in individual stocks, and it would even be very healthy for them to rest a bit. The market has had a good run and has managed to break out, but it also needs a digestion phase, so it can continue to work higher.
The bears believe there is a negative news catalyst coming that is going to take this market down, so the reaction to Alphabet (GOOGL) is important. But as we saw with Amazon (AMZN) , it is a mistake to be overly bearish, too fast.
Have a good evening. I'll see you Tuesday.