A flat-footed march at the moment

    Date:

    February ended on a high note — the highest of notes for the Nasdaq Composite and S&P 500, which logged record closing highs. The Dow Jones Industrial Average was shy of its own closing high, but nonetheless logged its fourth straight monthly gain along with the Nasdaq Composite and S&P 500.

    March has arrived today with everyone anxious to see if the rally will continue to march on, defying a festering belief that the indices are due for a period of consolidation if not a correction.

    The futures market isn’t providing much of a directional clue for today’s open. The S&P 500 futures are down two points and are trading fractionally below fair value, the Nasdaq 100 futures are up seven points and are trading fractionally above fair value, and the Dow Jones Industrial Average futures are down 28 points and are trading 0.1% below fair value.

    The opening march, then, is likely to be a bit flat footed.

    This lack of conviction ahead of the open is not unfamiliar. It has been more typical in recent days and weeks, as participants have been content to see how the price action in the cash market unfolds.

    When the concerted selling interest many think is likely to happen in the leadership stocks doesn’t happen, buying support driven by a fear of missing out on further gains arrives.

    It’s just enough to prevent any meaningful setback in the major indices and to keep them churning at higher levels.

    It wouldn’t be surprising to see the same churning action today. Dell (DELL) put up some results that will feed the market’s AI excitement. Shares of DELL are up, ho hum, 27%.

    That move should create some added trading interest in the AI space, but as can be seen in the futures trade, it hasn’t generated a lot of action in a broader market that is churning in spite of Dell’s big move, and a robust 17% gain in NetApp (NTAP) and solid 8% increase in Autodesk (ADSK) after their earnings reports.

    New York Community Bancorp (NYCB) has created a bit of a distraction, acknowledging last night that it has identified material weaknesses in the company’s internal controls related to internal loan review. Shares of NYCB are down 22%.

    There are story stocks today to be sure, but the story for the broader market at the moment is still undefined. That could change with a bevy of Fed speakers today and the release of the February ISM Manufacturing Index (Briefing.com consensus 49.5%; prior 49.1%) at 10:00 a.m. ET.

    For now, it’s a slow march to the open.

    Originally Posted March 1, 2024 – A flat-footed march at the moment

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    This material is from Briefing.com and is being posted with its permission. The views expressed in this material are solely those of the author and/or Briefing.com and Interactive Brokers is not endorsing or recommending any investment or trading discussed in the material. This material is not and should not be construed as an offer to buy or sell any security. It should not be construed as research or investment advice or a recommendation to buy, sell or hold any security or commodity. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.

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