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Market Updates

Nokia's warning has futures lower

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Stock futures were mixed until Nokia (NYSE:NOK) warned that earnings and revenues were going to come up short in the second quarter. The Finnish based wireless giant followed to say that it expects year-over-year sales growth of 10% in the second quarter.

Stock futures lower

Currently we're seeing S&P 500 futures trade lower by 9 points, NASDAQ futures are down 46 and Dow Futures are lower by 60 points. Fair value for the S&P 500 for today is $10.42. That price will not change during the day. Computers are set for program buying at $11.84 and set for selling at $8.80.

Five-year YIELD dips below 4.8%

Yesterday I alerted traders to be keeping an eye on the 5-year YIELD and the 4.8% (48.00 level on its chart). My feeling was that a dip in YIELD on this bond below 4.8% would indicate that market participants were starting to move more money into bonds and out of stocks. This morning, my downside alert on this bond was triggered and we're seeing the YIELD on this bond trade at 4.797%. This should have traders and investors getting more defensive. As money flows into the bond market, causing YIELD to drop, that is money that isn't going into stocks.

Bullish percent updates

A quick review of our risk indicators for some of the major indexes has the NASDAQ-100 bullish percent ($BPNDX) in "bear correction" status with 49% of the stocks in this index on point and figure buy signals. The NASDAQ Composite bullish percent ($BPCOMPQ) remains in "bull confirmed" status with 52.4% of the stocks on point/figure buy signals, but threatens to reverse on its chart should this reading fall to 50%. The S&P 500 bullish percent ($BPSPX) is still in "bear alert" status with 66% of the stocks currently on a point/figure buy signal. The NYSE Composite bullish percent ($BPNYA) remains in "bear correction" status at 47.78%. Rolling all of these together it is fairly evident that it is not too late for traders and investors to be protecting their portfolios by either snugging up stops, writing covered calls or buying some protective puts. Shorting some stocks with partial positions can also help a traders portfolio weather a storm should the markets continue to pull back. Yesterday, PremierMarkets.com profiled a 1/2 position short in shares of eBay (NASDAQ:EBAY) at $63 and this mornings pre-market trading near $61.93 could still be an actionable trading idea here this morning.

Jeff Bailey
Senior Market Technician
www.PremierMarkets.com

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