Market players were nervous about a possible negative reaction to a "hot" consumer price index report, but it has been anticipated to such an extent that the weakness produced by the news turned into a good dip-buying opportunity.
The minutes of the last Fed meeting also turned into a dud for the bears that are focused on the narrative that equities can't continue to run in an inflationary environment.
What made it even tougher on the stock market bears was the bonds shrugged off interest rate worries and traded strongly. The 20+ Year Treasury Bond fund (TLT) recovered its 50-day simple moving average and is well off the lows it hit on Monday.
Breadth was 5,150 gainers to 2,900 decliners, but what was most notable Wednesday was there was no late-day selloff for a change. There has been a series of weak closes, and they have been so routine that many traders were looking for the pattern to end.
Pockets of speculation expanded. There was some good trading in de-SPACs again, with names like Jasper Therapeutics Inc. (JSPR) , Redwire Corp. (RDW) , and Marqeta (MQ) doing well. The stock picking action had a more bullish feel today and looks promising, as we head into earnings news, but what is missing is some fear of missing out. There has not been any great anxiety about sitting on the sidelines and holding cash. When that changes, then we should start seeing some stronger upside momentum.
There was some choppy and inconsistent action Wednesday, but high price-to-earnings growth names did well, and stock pickers were looking more confident.
Have a good evening. I'll see you tomorrow.
