Stocks ended the week higher and the Dow and S&P 500 turned positive for the month. The Nasdaq and Nasdaq 100 are still slightly lower for the month but are on track to turn higher. Remember, what I said last week, it would be perfectly normal to see the market open lower for the month and end higher. In fact, that is a very bullish sign and exactly how healthy markets behave.
As 2017 winds down, the market remains exceptionally strong and weakness continues to get bought. Until we see any significant selling show up and last more than a few days, the market deserves the bullish benefit of the doubt.
A Closer Look at What Happened Last Week…
Mon-Wed Action:
Stocks ended mixed to mostly lower on Monday on the first full trading day after the Senate managed to narrowly pass a bill to reform the tax system on Saturday. Around 2am EST, Senate Republicans managed to win the final vote by a 51-49 margin, after Republicans had to rework the bill late on Thursday and Friday. When futures opened for trading late Sunday night, Dow futures were up over 200 points which lasted into Monday’s open. Shortly after the open, the Dow surged nearly 300 points but sellers showed up and the Dow only closed up 58 points. Meanwhile, the rest of the market closed lower as tech stocks weighed on the market.
On Tuesday, stocks ended mostly lower causing the S&P 500 to have its first 3-day losing streak since August. On Wednesday, stocks were quiet as the Nasdaq bounced and the Dow & S&P 500 were little changed.
Thur & Fri Action:
Stocks edged higher on Thursday after the House passed a bill to help avoid a government shutdown. Elsewhere, it was encouraging to see Lululemon ($LULU) gap up after the retailer reported earnings. For the past 18-24 months, retail stocks have been under pressure and now are slowly turning the corner. Wal-Mart ($WMT) gapped up a few weeks ago and hit a new record high after reporting earnings.
Stocks rallied nicely on Friday after the government released a strong jobs report. Last month, U.S. employers added 228k new jobs, beating estimates for a gain of 190k.
Market Outlook: Bulls Are Strong
The bulls are back in control and the market remains very strong. As always, keep your losses small and never argue with the tape.
