MLR - Premarket Pulse 3/13/13
All the major market indexes other than the Dow were slightly down on higher volume that came in just a bit above the prior day's volume. Nevertheless, this resulted in distribution days for the S&P 500 and the NASDAQ Composite Index. The averages had previously continued to move mildly higher as quantitative easing fuels the slow rise, and yesterday's pullback could be considered to be reasonably well-contained.
In a number of cases, including Michael Kors Holdings (KORS), company managements have made use of recent rallies in their stocks to unload shares via secondary offerings. The latest two companies to do so, U.S. Silica Holdings (SLCA) and NXP Semiconductor (NXPI) issued secondaries after their stocks had approached all-time price highs. Both secondary offerings knocked the stocks back, with SLCA taking a big 8% hit to the downside. SLCA is still trading above its prior buyable gap up buy point, and closed mid-bar, indicating some support for the stock. Meanwhile, other leaders moved higher including medical names like Santarus (SNTS), which recently had a buyable gap-up, Celgene (CELG) and Biogen (BIIB). LinkedIn's (LNKD) steeper ascent remains intact though it pulled back to its 10-day moving average where it could be in position for another continuation pocket pivot buy point.
Overall, the action remains relatively quiet with few if any actionable buy points showing up in leading stocks. Thus investors remain in a holding pattern for now.
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