The Dow currently appears to have found support near the lower boundary of the horizontal channel as the bulls road a 252 point rally over the last 2 sessions. Though this could be some short coverings from active traders driving a short term rally before a continued decline. Today the Dow closed just below the 50ema which will probably act as resistance. I think its probable that Fridays session will either be neutral or in favor of the bears. Guess we’ll find out, Toyota’s quarterly profit rose 32 percent so this could help drive some force in favor of the bulls.
Market update from Yahoo! Finance:
In similar fashion to yesterday’s late-day surge, the inability on the part of the bears to convincingly sell into another rally left the door open for market bulls to jump back in and declare victory for a second straight session.
At their highs, the Dow, S&P 500, and Nasdaq were up 1.0%, 0.7%, and 1.0%, respectively. However, unlike Wednesday’s whipsaw action and short-covering rally sidelining sellers into the close, equities were unable to finish at their best levels.
Of the eight sectors posting gains, the heavily weighted Technology sector (+0.9%) pacing the way was the key behind Thursday’s follow-through effort. Communication Equipment got a lift as Nokia (NOK 30.93 +2.52) soared 8.9% to a new high after more than doubling Q2 profits on strong revenue and market share gains. Home Entertainment Software (+7.2%) was the day’s best performing S&P industry group after Electronic Arts (ERTS 51.56 +3.46) raised its full-year revenue outlook.
Another Nasdaq-listed software name making waves was Checkfree (CKFR 45.40 +8.57). It signed a definitive agreement with Fiserv (FISV 49.50 +0.31) to be acquired for $4.4 bln in cash, a 30% premium to CKFR’s closing price Wednesday.
Even though the deal was not of the “blockbuster” variety investors have grown accustomed to, the proposed purchase lent some reassurance about this year’s record pace of deal making, especially after Advanced Medical Optics (EYE 32.08 +1.53) withdrew its $4.2 bln buyout bid for Bausch & Lomb (BOL 62.87 +0.33) yesterday.
Health Care and Consumer Discretionary were other influential leaders to the upside turning in similarly strong
