Monday, December 28, 2009

Holiday Rally Continues

In the absence of any significant news, traders took up and added to their positions in the midst of a year-end rally that now has stretched to six straight days of gains.

Once again, stocks traded in narrow ranges, led by large-caps, telecom and health care, especially Dow components AT&T (T) and Verizon (VZ). Gains were small and not broad-based, with financial stocks suffering late in the day.

Dow 10,547.08, +26.98 (0.26%)
NASDAQ 2,291.08, +5.39 (0.24%)
S&P 500 1,127.78, +1.30 (0.12%)
NYSE Composite 7,261.24, +6.24 (0.09%)

Declining issues pushed ahead of advancers, 3276-3228, though the number of new highs shot up to 733, against 93 new 52-week lows. Volume was nearly non-existent, as both the NYSE and NASDAQ recorded one of the slowest trading sessions of the year. Expect the low volume mantra to remain in place for the duration of the holiday-shortened week as many trading desks are closed for the holidays. Traders, investors, even hard-nosed day-traders apparently are finding other things to do with their time.

NYSE Volume 3,144,974,250
NASDAQ Volume 1,249,068,375

After falling for the better part of two weeks, oil has managed to gain back to $79.00, up 95 cents on the day, its highest closing level in two weeks. Gold also has regained its previously-lost footing, adding $3.00 to $1,107.80. Silver also gained, up 12 cents, to $17.56.

With so little activity, there simply isn't much to do this final week of 2009 except sit back and wait. Traders and volume should return after the first of the year. In the meantime, the economic schedule of releases is very light. The next major move in the markets should coincide with earnings reports, beginning the second week of the new year.

It's a good time to research, reflect and refocus.

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