Before the Open (Apr 21)

Good morning. Happy Monday. Hope you had a nice weekend.
The Asian/Pacific markets closed mixed. China dropped 1.5%, India and Malaysia did well. Hong Kong, Australia and New Zealand were closed. Europe is closed. Futures here in the States point towards a positive open for the cash market.

The dollar is up a small amount. Oil and copper are down. Gold and silver are down.
The market rallied nicely last week. This put Dow back at resistance and the S&P 500 back in its consolidation range (it had briefly traded above the range and then dropped to penetrate the bottom of the range). But the Nasdaq and Russell small caps are much worse off. It’s true they successfully tested their February lows, but they have a lot more resistance overhead to contend with and volume the last month definitely tells us stocks are being dumped, not accumulated. I think the Nas and small caps hold the key going forward. If they continue up, the market will do the same. If they struggle and lag the large caps, the market won’t go anywhere.
Today starts the first day of trading since options expired. Options expiration has been a meaningless day for many years. There was a time when stocks would be all over the place intraday (lots of games played), but not any more. Whatever traders need to do in preparation for expiration is typically done by the time OE rolls around, but a new development has formed the last couple years…that is the tendency for the market to move up into expiration and then sell off afterwards. It doesn’t happen all the time, but it happens enough to be aware of it for the next couple days.
Last week’s bounce was the easy move…holiday-shortened week, lighter volume, oversold conditions. Now the hard work begins. I don’t think the near term is obvious. More after the open.
Stock headlines from barchart.com…
Kimberly Clark (KMB +0.12%) reported Q1 adjusted EPS of $1.48, better than consensus of $1.47.
Halliburton (HAL +0.66%) reported Q1 EPS of 73 cents, higher than consensus of 71 cents.
Hasbro (HAS +1.41%) reported Q1 EPS of 14 cents, stronger than consensus of 10 cents.
Morgan Stanley (MS +2.91%) was upgraded to ‘Buy’ from ‘Neutral’ at Nomura.
Arch Coal (ACI +0.80%) was upgraded to ‘Neutral’ from ‘Sell’ at Goldman Sachs.
Big Lots (BIG -0.51%) was upgraded to ‘Overweight’ from ‘Neutral’ at Piper Jaffray.
Yum! Brands (YUM -0.68%) was downgraded to ‘Neutral’ from ‘Overweight’ at JPMorgan Chase.
Chipotle (CMG -5.94%) was upgraded to ‘Overweight’ from ‘Neutral’ at JPMorgan Chase.
SunTrust Banks (STI -0.55%) reported Q1 EPS of 73 cents, bettter than consensus of 66 cents.
GLG Partners reported a 5.05% passive stake in Shanda Games (GAME +0.76%) .
Advanced Micro Devices (AMD -1.86%) reported Q1 adjusted EPS of 2 cents, better than consensus of no change.
Hub Group (HUBG +1.06%) reported Q1 EPS of 33 cents, less than consensus of 36 cents.
Earnings and Economic Numbers from seekingalpha.com…
Today’s economic calendar:
8:30 Chicago Fed National Activity Index
10:00 Leading Indicators
Notable earnings before today’s open: HAL, HAS, KMB, LII, RCI
Notable earnings after today’s close: BXS, BOH, BRO, CDNS, CE, CYS, DRWI, GLF, HSTM, HLX, HXL, ICUI, NFLX, RMBS, RCII, UMPQ, WCN, WAL, ZION
Other…
today’s upgrades/downgrades from briefing.com
this week’s Earnings
this week’s Economic Numbers