The major indexes continue to hold onto fractional gains after a dip lower at the open, with strength in the Airline Index (XAL.X) 34.17 +5.95% giving a boost to the Dow Jones Transportation Index (TRAN) 2,300 +3% as investors await a critical decision by AMR Corp's (NYSE:AMR) $4.02 +30.5% American Airlines flight attendants union on proposed cost cutting measures.
Financial sectors are helping hold the broader S&P 500 Index (SPX.X) 887 +0.2% above the unchanged level with the S&P Banks Index (BIX.X) 281.24 holding a rally high at its 200-day SMA. Shares of Bank of America (NYSE:BAC) $72.80 +1.11% have moved above their July highs of $72.70 after reporting earnings yesterday of $1.59, which handily beat estimates by 11 per share. Well Fargo (NYSE:WFC) $47.32 +1.11% looks to rebound from a recently completed convertible offering after reporting Q1 EPS of $0.88 per share this morning, which was a penny better than consensus estimates.
Bank of America (BAC), which is also a component of the KBW Banks Index (BKX.X) 771 +1.42% has helped boost many of the "super regionals" in this index, while the Securities Broker/Dealer Index (XBD.X) 418 +1.32% sees Goldman Sachs (NYSE:GS) $75.74 +1.67% continue to find buyers after last week's move above its 200-day SMA of $71.50.
In last night's Index Trader wrap, I thought the major Indexes might take a "queue" from the S&P Banks Index on a move higher and have the Dow, SPX and OEX perhaps managing a test of their WEEKLY R1 levels of resistance. While index bulls are getting the upside action they wanted from the banks, they're not getting the selling in Treasuries that I would have wanted to see for some "confirmation" of bullishness. As we approach the bond market's close, Treasuries have been seeing buying for the bulk of today's session with the 10-year June Futures contract (ty03m) $114'025 +0.26% gaining 9/32 and the benchmark bond's YIELD ($TNX.X) falling back below its WEEKLY pivot of 3.983% with a 3.977% YIELD.
Today's sector loser has the Morgan Stanley Health Provider Index (RXH.X) 256 -5.71% pummeled lower after healthcare provider HCA Healthcare (NYSE:HCA) $28.99 -19.6% warned on its upcoming Q1 that EPS of $0.81-$0.83 (excluding items) would fall short of analysts expectations as a decline in facility admissions is weighing on results. The new out of HCA has also brought sellers to the operating table at Triad Hospitals (NYSE:TRI) $21.41 -14.4%, LifePoint Hospitals (NASDAQ:LPNT), Community Health (NYSE:CYH) $18.51 -7.4% and other hospital-related issues.
I've received several e-mails from options traders regarding the trade-shortened week, which has the markets close on Friday (options expiration) due to Good Friday. April equity options will stop trading on Thursday. The CBOE states that if the third Friday of the month is an exchange holiday, the last trading day is the Thursday immediately preceding the holiday.
As a side note.... according to the Stock Trader's Almanac, April expiration has seen the Dow Industrials trade higher 8 of the last 12 expirations, while the day before April's Good Friday has seen the Dow Industrials post a gain in 7 of the last 9 years.