Tuesday, May 10, 2011
Stock Market Commentary:
Stocks and a host of commodities rallied for a second straight day after last week’s week-long “Flash Crash.” From our vantage point, the market rally remains under pressure due to the lackluster action in the major averages and several leading stocks.
Import Prices Rise; Rate Of Growth Slows
The Labor Department said overall import prices rose +2.2% in April which was the seventh consecutive monthly gain. April’s rate eased from March’s +2.6% but topped the Street’s estimate for a +1.8% rise. The report helped allay concerns that inflation was accelerating. In other news, Microsoft (MSFT) agreed to buy Skype for $8.5 billion.
Market Outlook- Rally Under Pressure
From our point of view, the market rally is under pressure which suggests caution is paramount at this stage. Looking forward, the next level of support for the major averages are their respective 50 DMA lines and resistance is their 2011 highs. The rally remains in tact as long as support holds. If you are looking for specific help navigating this market, please contact us for more information.