Before the Open (Feb 10)

Good morning. Happy Monday. Hope you had a nice weekend.
The Asian/Pacific markets closed mixed and with a bullish lean. China rallied 2%; Australia and Japan rallied more than 1%. Europe is currently also trading with a bullish slant, but Belgium is the index posting a decent gain; Spain is down almost 1%. Futures here in the States point towards a gap down open for the cash market.

The dollar is down slightly. Oil is down, copper up. Gold and silver are up.
The market finished last week with two big up days that put the S&P up on the week…despite starting the week with one of the biggest down days of the last year.
Now things get very interesting. The market has rallied back about 50% of its move down – a normal amount – on lighter volume. The first move off a low is the easy move because supply/demand and sentiment shift away from the bear’s corner. But then institutions need to step up in order for the gains to continue. Said another way, buying 50 S&P points ago wasn’t hard for big funds; buying now is more difficult because many stocks have already popped off low levels. If big funds come and continue buying, it’s a very good sign.
A few indicators have reversed and now support more upside, but they have to continue. A few other indicators are at extreme levels but haven’t reversed. They will need to.
The 100-point move down wiped out most of the good looking charts and zapped the enthusiasm of the bulls; the 50-point rally wiped out many good looking bearish charts and is dampening the bear’s enthusiasm for going short.
The next few days will be key. The indexes are in no-man’s land, and both the bulls and bears are on the edge of their seats. Short term I don’t have a bias. Long term I lean to the downside. More after the open.
Stock headlines from barchart.com…
Loews (L +0.98%) reported Q4 EPS of 65 cents, below consensus of 70 cents.
ArcelorMittal (MT +1.29%) was downgraded to ‘Neutral’ from ‘Buy’ at BofA/Merrill.
Urban Outfitters (URBN +1.80%) was upgraded to ‘Buy’ from ‘Hold’ at Brean Capital.
Hasbro (HAS +0.87%) reported Q4 EPS of $1.12, weaker than consensus of $1.22.
Whole Foods Markets (WFM +0.18%) was upgraded to ‘Buy’ from ‘Hold’ at BB&T.
Apollo Global (APO +0.38%) was upgraded to ‘Buy’ from ‘Neutral’ at Citigroup.
Bristol-Myers (BMY +2.76%) was upgraded to ‘Outperform’ from ‘Market Perform’ at BMO Capital with a price target of $50.
Texas Roadhouse (TXRH +2.52%) was upgraded to ‘Strong Buy’ from ‘Outperform’ at Raymond James.
Piper Jaffray reiterated its ‘Overweight’ rating on athenahealth (ATHN +25.06%) and raised its price target on the stock to $220 from $170.
Jennison Associates reported a 5.9% passive stake in Michael Kors (KORS +2.97%) .
Polar Securities reported a 5.7% passive stake in Kirkland’s (KIRK -1.00%) .
Aisling Capital II reported a 13.8% passive stake in Esperion Therapeutics (ESPR +11.37%) .
Elon Musk reported a 23.1% stake in SolarCity (SCTY +3.68%) .
Earnings and Economic Numbers from seekingalpha.com…
Today’s economic calendar:
No events scheduled.
Notable earnings before today’s open: BWP, CNA, CYOU, HAS, L, MCY, MNTA, SFUN, SOHU, TTI
Notable earnings after today’s close: ACAS, AMKR, BNNY, CAP, CMP, CRK, CYS, KS, MAS, MERU, MKL, MODN, MOH, NUAN, OMI, OTTR, PRI, PSE, PXD, QLYS, RAX, RBC, SSNI, WCN
Other…
today’s upgrades/downgrades from briefing.com
this week’s Earnings
this week’s Economic Numbers