Major averages barely budged yesterday, finishing mildly lower to consolidate recent sharp gains on higher volume. Declining stocks led advancers, however, by nearly 2.5 to 1 on the NASDAQ and nearly 3 to 1 on the NYSE. The majors are just a few percent away from new highs and have cleared their respective 50-day moving averages, but the underlying action yesterday was weaker than the indexes themselves. The Federal Reserve concludes its meeting today which will most likely be a market-soothing announcement of a dovish nature since they are hamstrung in terms of hiking rates due to the weak global economy. The odds of a rate hike remain at a mere 6%. For the December 16 meeting, the odds are only a bit better at 35%.
Twitter (TWTR) disappointed after the close with its earnings report, trading more than 10% lower. This is the third earnings disappointment in a row for the company.
Apple (AAPL) also reported earnings after the close which pushed the stock 3% higher after hours before it settled in to be up about 1%, where it is at currently in pre-market trade. AAPL's last earnings report was considered a blowout, yet the stock gapped down hard. This time around AAPL merely met estimates, which is so far having a positive effect on the stock and the NASDAQ-100 futures, of which AAPL is a significant component.
Electronic mortgage origination service provider Ellie Mae (ELLI) had a pocket pivot as it rounds out the lower portion of its base through its 50dma. Earnings and sales are strongly accelerating, pretax margin 25.3%, group rank 34.
Semiconductor company Integrated Device Technology (IDTI) had a buyable gap up on a strong earnings report. Earnings are skyocketing, pretax margin 26%, group rank 59. Note that while the stock finished in the lower half of its trading range, it is still up nicely in context with its chart. Naturally, in the days ahead, as a good sell stop, it can be sold should it break below yesterday's low by 1-2%.
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