Stock futures are on the move higher this morning and Treasuries are under heavy selling pressure as war optimism builds as coalition forces passed through Karbala after heavy fighting versus the Iraqi Republican guards.
New wires report the coalition forces are now within 20-miles of Baghdad.
Treasuries are seeing selling across the board. In last night's Index Trader Wrap at OptionInvestor.com, I thought equity bulls wanted to see the 10-year YIELD ($TNX.X) see enough selling to have its YIELD move above 3.830% and for bullishness to build on further selling in the bond to 3.880%, which would be right near yesterday's highs. This morning, selling in the benchmark bond is strong with its YIELD jumping to 3.895%, which in my opinion will fuel a strong rally today that may have legs.
While Treasuries are seeing selling, the dollar is showing gains against major foreign currencies with the U.S. Dollar Index (dx00y) 99.78 +0.63% trying to make a move back above its crossing 21-day and 50-day SMAs of 99.70. In yesterday's market monitor at OptionInvestor.com, I noted strength in the dollar and viewed it slightly positive for equities, but wanted to see some selling in bonds at the time to really have stocks in "rally mode" and building gains. This morning's action between the dollar and bonds looks to give further legs to equities.
I'm currently playing yesterday and today's bullishness as though the recent pullback lows in the major indexes are now firm support and would look for market participants to try and leverage off the recent lows as support.
S&P futures (sp03m) which had jumped to a 866.00 yesterday afternoon, just before Central Command reported that U.S. troops and found a U.S. POW, but then settled back 860 when I left work at 10:00 PM EST, are currently building gains to 870.60, which is up 13.90 points. NASDAQ futures (nd03m) are higher by 23 points at 1,046, while Dow futures (dj03m) are rising 125 points at 8,165.
Fair value for the S&P 500 today is $-0.91. That price will not change during the day. HL Camp & Company has their computers set for program buying at $0.21 and set for program selling at $-2.26.
Warren Buffett's Berkshire Hathaway is in the news this morning after saying it would acquire manufactured housing concern Clayton Homes (NYSE:CMH) $11.13 for $12.50 per share in cash.
Shares of Biogen (NASDAQ:BGEN) $30.29 are gaining 9.2% to $33.10 in pre-market trade after the company issued upside guidance this morning for its March Q1. BGEN said it now sees EPS of $0.47- $0.51, excluding a one-time charge of $0.08, which is well above consensus estimates of $0.37 (ex-charges). BGEN also said it see fiscal year 2003 EPS of $1.72-$1.85, which is also above consensus of $1.66 per share. The company attributed the strong- that-expected forecast to its successful launch of Amevive.