Stocks End Lower On Profit Taking After Weeks Of Gains  Image: Bigstock Stocks closed lower yesterday on continued profit taking. As I mentioned at the beginning of the week, after 5 up weeks in a row for the S&P, and 8 up weeks in a row for the Nasdaq, some profit taking was bound to set in. And that's likely what we're seeing now. The only report out yesterday was the MBA Mortgage Applications report which showed a 0.5% w/w increase, with purchases up 1.5%, while refi's were down -2.1%. Fed Chairman, Jerome Powell, was on Capitol Hill yesterday, giving his semiannual testimony on monetary policy to the U.S. House Financial Services Committee. He did not break any new ground. Instead, he confirmed what he shared with everyone last week: that more rate increases are likely given that inflation is "well above" where it should be. That was the message he gave at last week's press conference following the FOMC announcement – that there's the potential for two more 25 basis point rate hikes on the horizon if inflation doesn't start dropping faster. Mr. Powell will give his testimony today to the U.S. Senate Committee on Banking, Housing, and Urban Affairs. We'll also get more economic reports with Weekly Jobless Claims, the Chicago Fed National Activity Index, Existing Home Sales, and the Leading Indicators report. In spite of recent profit taking, stocks are doing well this year with the Dow up 2.43%, the S&P 500 up 13.7%, the Nasdaq up 29.0%, the small-cap Russell 2000 up 5.78%, and the mid-cap S&P 400 up 5.26%.
And it looks like there's more upside to go. If we are lucky enough to see a bigger pullback, I would be looking to buy the dip. But if no dips come, buying strength works as well. See you tomorrow,  Kevin Matras
Executive Vice President, Zacks Investment Research | 
Post a Comment
Post a Comment