Sure we had a better-than-expected ISM number may seeing the indicator rise to 53.7 where forecasts were for the index to fall to 53.1 from the April reading of 53.5. The ISM is a reading on how the manufacturing sector is doing, and any reading above 50 means the service sector is in growth.
But really we rallied on hope. That Germany will say those magic words of “we’ll bail you out” – as in Germany will keep the peripheral Eurozone countries afloat through their woes holding together the monetary union. Although until their is a fiscal union we will only see these problems again.
The DOW (INDU) rose 26 points to close at 12,127.95. The S&P 500 (SPX) gained 7 points to close at 1,285.50. And the tech heavy Nasdaq (COMP) rose 18 points to close at 2,778.11.
Right now it all hinges on Angel Merkel of Germany and what she does Wednesday. There has been low volume and most investors are standing on the sidelines until there is a certainty in whats going to happen with Europe. Its best to have some trades down now in case we do get the walled rally but if Germany says no its right back down, so a good cash stockpile is necessary as well. And many are now thinking China might not have the actual ammo for another full round of stimulus – so direct sugar to the market might not happen.
And as for Facebook (FB), you gotta let the chart develop, it is simply wandering lost in the woods right now. Once it gets to $23 it’ll shake out all the loose hands and then can start its M&A fueled ascent. Today the equity closed down 3.83% to $25.869 a share.
Oil gained 31 cents to $84.29 a barrel.
Gold gained $3 to $1,616.90 an ounce.
The American 10-Year Note fell pushing the yield up to 1.58% (yields are inverse of price).