EmailFor those of you just coming out from under a log, let us be the first to tell you that the Dow Jones Industrial Average closed at a new all-time high yesterday. The same goes for the Dow Jones Transportation Average, meaning Dow theorists the world over are rejoicing right now.
Frankly, a lot of investors -- at least the ones in the market -- are rejoicing at this moment. The broader market cannot be stopped -- or so it seems -- as every dip is met with buying interest and any piece of bad news is quickly drowned out by the chorus that central banks have the market's back and that things are going to look better in the second half of the year.
The S&P 500 price index still has some work to do to claim title to a new all-time high, but it will do so soon with more performances like the one seen Tuesday in which it gained nearly 15 points, or almost 1.0%, on healthy leadership from the cyclical sectors.
There was a good deal of excitement surrounding yesterday's rally, which is why it was a bit surprising to see that NYSE volume totaled just 683 mln shares versus a 50-day average of 719 mln shares.
Anyone trying to downplay the market's gains due to the low volume has been fighting a losing battle for some time. It is what it is, and the fact of the matter is that low volume thus far has not equated to short-lived rally efforts.
The market has essentially been in a rally mode for the last four years. There have been some unsettling moments along the way, but the Federal Reserve and other central banks have been there every step of the way to hold the market's hand through those turbulent periods.
Yesterday's rally looks poised to persist at the start of today's trading. The S&P futures are trading 0.3% above fair value, underpinned by carryover buying interest that bolstered foreign markets and an encouraging ADP Employment Change report for February.
The latter showed an estimated 198,000 jobs were created in the private sector in February. That was above the Briefing.com consensus estimate, which called for an increase of 150,000 positions, and it followed on the heels of an upwardly revised 215,000 increase (from 192,000) in January.
The services sector accounted for the bulk of the job gains (164,000) and hiring was distributed neatly across all company sizes. Small businesses led the way with 77,000 new jobs added, followed by medium-sized businesses (+65,000) and then large-sized businesses (+57,000).
This report will set a hopeful tone ahead of Friday's Employment Situation report for February. Currently, the Briefing.com consensus estimate for nonfarm private payrolls is 178,000.
Now, if you'll excuse me, this Chicago-based analyst, who dug out of 10 inches of snow last night and early this morning, needs to go have a word with Punxsutawney Phil who emerged from his temporary home under a log in mid-February to predict an early Spring.
I'll tell him for the record that the Dow Jones Industrial Average is at a new all-time high and that his popularity rating in these parts is at an all-time low.
