The markets opened higher and rose to new all-time highs on Friday, only to get repelled in the afternoon and close lower on the session. This was one of the likely outcomes that I expected going into Friday’s session. There were four causalities which we can take independent of one another or together to explain the Friday turnaround and pullback:
- The impact of weekly and quarterly options expiration
- The Friday fear trade as traders take capital off the table frightened of more political / military action in Ukraine / Crimea
- Normal market action which occurs when new highs are made and traders lean against those levels.
- Plain old profit taking after a bullish week.
On Friday hot sectors such as internet and biotech appeared to be under consolidation with profit taking at the forefront.
However, Monday is another day. There was no news out of Russia. Despite weaker than expected economic data out of China, Chinese and other Asian markets rose. Finally, News Corp (NWS) seems to have blessed Apple (AAPL) with some positive news as we get set for the trading week. First, on Saturday, an article in the company’s weekly Barron’s newspaper set forth a hypothesis for Apple rising 20% on the issuance of the company’s iPhone 6. Then today the Wall Street Journal, another News Corp publication, reported that Apple and Comcast’s CNBC Universal unit are in talks to partner together on a streaming television service.
While the quarter formally ends next Monday, this week is the last full week of business for the quarter. Investment managers are going to be cleaning up their portfolios and looking ahead to the second quarter. I expect a mildly positive day today and one for the week as well. There is a possibility that we could eclipse the recent high on the S&P 500 and even hold it as we commence the second quarter but I am more concerned about keeping the uptrend in place than reaching new highs this week. Don’t forget the Monday fade which should come in the late morning or early afternoon after any early rise in the markets.
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Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL — although positions can change at any time.
LakeView Asset Management, LLC is a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant and agricultural stocks. A subscription is included with a paid Platinum Membership to Wall Street All-Stars or an individual subscription to the newsletter which can be ordered at www.restaurantstox.com
Read Scott’s intra-day thoughts and comments on Scutify
You can email Scott at scott.rothbort.lakeview@gmail.com
__________________________________________________________________________________
Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView Asset Management, LLC had no positions in stocks mentioned — although positions can change at any time.
LakeView Asset Management, LLC is a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant and agricultural stocks. A subscription is included with a paid Platinum Membership to Wall Street All-Stars or an individual subscription to the newsletter which can be ordered at www.restaurantstox.com
Read Scott’s intra-day thoughts and comments on Scutify
You can email Scott at scott.rothbort.lakeview@gmail.com
