The stock market bent on Monday (barely) but it didn't break. In the end, the S&P 500 registered another gain, albeit a modest one, and another record high. The same held true for the Nasdaq Composite.
There is an early bid in the futures market, too, that suggests the major indices should at least start today's session on a modestly higher note.
To that end, the S&P futures are up five points and are trading 0.2% above fair value. The Nasdaq 100 futures are up 15 points and the Dow Jones Industrial Average futures are up 68 points, leaving them both about 0.3% above fair value.
There may not be a lot of buying conviction overall, but more tellingly, there has been no meaningful selling interest to this point. We're not just talking about this morning either. That claim applies to all of 2017 in terms of the major indices.
The support structures have been widely discussed -- low interest rates, strong earnings growth, synchronized global growth, and tax reform optimism -- so with the latest extension of the bull market, there is a growing body of commentary focused on what could upend the bull market.
Rising interest rates seem to be at the top of every spoiler list, as they call high stock market valuations into question.
Notably, the yield on the 2-yr Treasury note (1.95%) exceeds the S&P 500 dividend yield (1.91%), meaning effectively that investors have a comparable income-generating option without any risk.
That doesn't mean everyone is going to shift out of equities all of a sudden, yet it is a tacit indication that the risk-reward trade-off in the stock market isn't as attractive as it used to be.
Rewards can still be found, however, in the stocks of companies that are executing well and are raising their earnings guidance. Enter retailer Target (TGT), which raised its fourth quarter and full-year 2017 guidance following strong holiday sales and issued full-year 2018 guidance that is above analysts' consensus estimate.
Shares of TGT, which have risen 24% from their mid-November low, are indicated 3.8% higher in pre-market action.
Separately, Seagate Technology (STX) expects to report fiscal second quarter revenues that are above analysts' average expectation. Its stock is trading 0.9% higher in pre-market trading, yet it jumped 7.1% on Monday on the heels of speculation tied to an investment stake the company reportedly has in the crypto currency Ripple.
The important aspect of Seagate's guidance is that it was linked to better than expected demand for its HDD mass-storage solutions.
These guidance updates are reminders that the stock market's fundamental underpinnings remain in place, which is why sellers have largely remained in place.
It's a reassuring conduit to the upcoming fourth quarter earnings reporting season, which will get rolling on Friday with reports from several financial companies, including JPMorgan Chase (JPM).
Today's economic calendar isn't expected to make any waves for the market. It features the NFIB Small Business Optimism Index for December, which slipped to 104.9 from 107.5, and the JOLTS - Job Openings report for November at 10:00 a.m. ET.
The Treasury market is a mixed bag with gains at the front end and losses at the back end of the yield curve. The yield on the 10-yr note has increased two basis points to 2.50%, having floated higher along with oil prices ($61.94, +$0.21, +0.3%) and chatter that the Bank of Japan and the ECB may ultimately feel compelled to provide less policy accommodation sooner than policy makers currently expect.
The interest rate factor, therefore, is looming over the stock market even though it hasn't spoiled anything just yet.