Before the Open (Jun 1)

Good morning. Happy Monday. Hope you had a great weekend.
The Asian/Pacific markets closed with a lean to the downside. China rallied 4.7%, and Hong Kong moved up 0.6%, but Australia, South Korea and Taiwan each dropped more than 0.6%. Europe currently leans to the upside. France, Spain, Switzerland, Prague and Russia are doing well; Norway is down. Futures here in the States point towards a moderate gap up open for the cash market.
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The dollar is up. Oil and copper are down. Gold and silver are down. Bonds are down.
We enter this new week with the long term trend being solidly up, the intermediate term being neutral and the path of least resistance in the near term being down.
The small caps have been lagging (the large cap put in a higher high while the small caps put in a lower high) – this has typically led to a correction in the near term.
Several indicators, including the AD line, AD volume line, cumulative TICK and S&P bullish percent index have also diverged from the price action. This tells us the internals are weak, the participation rate is low – not a good environment for attempting a rally.
Until these items are negated the upside will be limited, and the path of least resistance will be down. This doesn’t mean we’ll get a huge correction, but more likely than not we’ll get something before the charts can re-set. More after the open.
Stock headlines from barchart.com…
Juniper (JNPR +0.54%) was downgraded to ‘Sell’ from ‘Neutral’ at MKM Partners.
Wells Fargo said it sees a potential for 75% upside in DISH (DISH +0.70%) shares.
Duke Energy (DUK -0.29%) was upgraded to ‘Outperform’ from ‘Market Perform’ at Bernstein.
Verifone (PAY +0.37%) was upgraded to ‘Outperform’ from ‘Market Perform’ at Raymond James.
Enbridge (ENB -1.40%) and Boyd Gaming (BYD -0.28%) were both upgraded to ‘Outperform’ from ‘Neutral’ at Credit Suisse.
Coca-Cola (KO -0.44%) was upgraded to ‘Outperform’ from ‘Market Perform’ at BMO Capital.
According to DigiTimes, data from Gartner showed Q1 global server shipments up 13% y/y.
Citigroup (C -0.86%) was upgraded to ‘Buy’ from ‘Neutral’ at Goldman Sachs.
Altera (ALTR +4.00%) jumped over 6% in pre-market trading after people familiar with the matter said that Intel INTC is near a deal to acquire the chipmaker.
Stonepine Capital reported a 5.2% passive stake in Aegerion (AEGR -1.02%) .
O’Reilly Automotive (ORLY -1.41%) increased its stock repurchase authorization by $500 million to $5.5 billion.
Ryanair (RYAAY -2.06%) was downgraded to ‘Neutral’ from ‘Buy’ at Goldman Sachs.
Point72 reported a 5.0% passive stake in Achillion (ACHN +5.89%) .
Earnings and Economic Numbers from seekingalpha.com…
Today’s economic calendar:
8:30 Chicago Fed National Activity Index
10:00 Existing Home Sales
Notable earnings before today’s open: PVH, QUNR
Notable earnings after today’s close: none
Other…
today’s upgrades/downgrades from briefing.com
this week’s Earnings
this week’s Economic Numbers