Monday's action in markets has been very similar to almost every session outside of last Thursday where there is a little action in the opening hour, a little action in the closing 15 minutes, and a whole lot of nothing in between. Both the S&P 500 and NASDAQ were down fractionally, despite the heroic efforts of Apple (AAPL) which has soared to new highs. While the current move is not quite as parabolic as what was seen in late winter, the stock is quite stretched here.
Apple has now reached a new record with a valuation of $624 Billion. To put that in perspective, the second most valuable company is Exxon Mobil at.... $406 Billion. In the internet bubble days, Microsoft peaked at $620 Billion. To complete the circle of life, when Apple was struggling in the late 90s, Microsoft invested in the company which many now claim helped it survive! Another fun fact:
The peak price for one Apple share is now less than $2 away from the retail price of the Apple I computer in 1976. It sold for $666.66.
As a substantial weighting in both the S&P 500 and especially NASDAQ, this one stock helped push the indexes up, while there was little positive action elsewhere outside of perhaps financials.
As for the S&P 500 and NASDAQ the picture has not changed at all in some time. The S&P 500 is at the top of its ascending channel, hence has a difficult time making much headway upward. On the other hand there is an absence of selling so the moves have either been up or sideways in extremely light volume for the past few weeks.
The NASDAQ, while nowhere near April highs (unlike the S&P 500), sits in a similar situation in how it has been going sideways or slightly up most days.
This very slow motion melt up has helped the market avoid any form of overbought condition. However, as stated above by sitting at the top end of a range it is difficult to make substantial moves upward.
There was no major economic news Monday but looking ahead we have the release of the Federal Reserve Open Committee minutes Tuesday afternoon at 2 PM. While that meeting was before some recent data points that showed mild economic improvement, traders will be scouring every comma and phrase for hopes of the QE drug. Wednesday (existing homes) and Thursday (new homes) bring data on housing, while a durable goods number is released Friday. Also keep an eye out for flash Chinese PMI to be released Wednesday night.