Stocks pulled back slightly Thursday as investors looked for any excuse for profit taking and to work off an overbought condition. It was delivered via a market rumor that a Bernanke speech Friday morning would include comments about tapering bond purchases. Of course just two weeks ago the Federal Reserve meeting added language about increased bond purchases for the first time, so it was a silly reaction but with markets so skewed to the upside any excuse for some minor profit taking would do. The S&P 500 fell 0.37% and NASDAQ 0.12%. These are minor scratches; if the market consolidates a few more days in similar fashion it should be ready to make a new thrust upward shortly after.
Stocks opened the new week similar to how they have traded for most of the sessions in December - in a very small daily range. Later this week is the Federal Reserve meeting so investors might be waiting for that as a catalyst; if not then nothing seems to be moving the market until the fiscal cliff can is kicked. The S&P 500 gained 0.03% while the NASDAQ gained 0.3% Overseas there was drama in Italy as Prime Minister Mario Monti announced he will resign after budgets are complete.
On a day when news broke that July was the hottest month ever, the market was hardly luke warm. We finished flat, with an inside bar, and volume on the S&P 500 was way below average.
On the earnings front the big news today surrounded Priceline (PCLN) which disappointed last night after the close and shed -17.3% in today's trading. Thanks to weak guidance, the stock fell under $600 a share and weighed down the rest of the travel booking group with it (EXPE -4.6%, TRIP -4.9%).
The market rebounded today after being heavily oversold as highlighted here last night. The headlines are citing Alcoa's (AA) positive earnings as the main driver, but the reality is the market was coming off five straight down sessions in a row and gapped at the open. I'd love to see how many times in history Alocoa has single handedly caused such an effect, because it probably has never happened.