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“Do not anticipate and move without market confirmation—being a little late in your trade is your insurance that you are right or wrong.” – Jesse Livermore
It’s a quiet morning as there’s little in the way of major economic releases today. There were a handful of earnings reports overnight from the likes of Advanced Auto (AAP), Hewlett Packard (HPE), and Zoom (ZM). Futures have been trading with a modestly positive bias all night and remain that way this morning. In politics, President Biden is scheduled to meet with Republicans today to try and reach some sort of consensus on infrastructure so we’ll be watching this afternoon for any updates on that front.
Read today’s Morning Lineup for a recap of all the major market news and events including a recap of some notable earnings reports, major economic data out of Asia and Europe, a discussion of the Chinese Property market, and the latest US and international COVID trends including our vaccination trackers, and much more.
Relative to where they opened yesterday, both the S&P 500 and Nasdaq had disappointing closes finishing near their lows of the day. The small-cap Russell 2000, however, was a different story. While it also experienced a small pullback from its opening levels in early trading, it rebounded and finished near its highs of the day.
From a longer-term perspective, yesterday’s late-day strength in the Russell 2000 sets the stage today for a test of its downtrend from the early March high as it closed yesterday just below its downtrend line. In pre-market trading right now, the Russell 2000 is slightly positive, so as long as those gains can hold, the technical picture for small caps will look incrementally better.