Stocks surprised to the upside Tuesday as many expected some significant losses on the first day of the government shutdown. However, the market has been selling off for a week and a half in anticipation of this event, and most also believe a resolution will come soon. The S&P 500 gained 0.80% and the NASDAQ 1.23% as recent outperformance by the NASDAQ continued. There was some good news from the ISM Manufacturing report released at 10 AM, but by that time the market had already rallied quite a bit.
The Institute for Supply Management (ISM) said its index of national factory activity rose to 56.2 in September from 55.7 in August, marking its highest level since April, 2011. The report showed that firms added the most workers in 15 months during September.
We continue to see the NASDAQ outperform the S&P 500 as today pushed it to a year high. The S&P 500 still has some work to do as it is stuck in this descending channel, and also below early August highs.
The NYSE McClellan Oscillator went negative for the first time during this rally and week and a half correction yesterday but recovered today. One would like to see this measure stay stable in the 10-40ish range.
Transports broke out of their descending channel - if this holds, it will be a positive. We want to see the same thing happen in the broader market i.e. the S&P 500.
In terms of sector, filed under the "what correction?" folder are biotechs - very strong.
Apple lead the charge for the NASDAQ, as investor Carl Icahn is trying to get a stunning $150B buyback program going.
Activist investor Carl Icahn is pressuring Apple to spend $150 billion buying back its own stock, a target that would more than double the amount that the company's board authorized in a previous attempt to placate frustrated shareholders. Icahn took to the Internet and the TV airwaves Tuesday to make it clear that he believes Apple Inc. isn't doing nearly enough to boost its stock price, which has fallen by 30 percent from its peak in September 2012.
Yahoo has gone parabolic of late, as today Citigroup upgraded it. Where was the upgrade 3 weeks ago at far lower prices?
Citigroup raised its price target on the stock to $39 from $31. In a note to clients, analyst Mark May cited his increased valuation of Alibaba -- the Chinese e-commerce giant in which Yahoo holds an ownership stake -- as well as "raising our valuation for core Yahoo! based on recent strong user growth and search trends," along with higher valuation multiples for the peer group.
A lot of the "familiar suspects" that our regular readers will know by now had fantastic days ... just a sampling of them: