After a volatile week to kick off June, the market looks like it could be starting to settle into a Summer trading vibe. After opening higher this morning, indices traded in a tight range all day and finished close to the flat line. The S&P and Dow finished down 0.03% and 0.06%, respectively, while the Nasdaq gained 0.13%.
Late last week the S&P bounced impressively off the 50-day moving average, and then accelerated to the upside on Friday's solid jobs report. Last night futures opened slightly lower after some weak data from China over the weekend, but a strong bounce in the Nikkei helped propel them higher by this morning's open.
The big event US investors were watching today was the annual Apple (AAPL) WorldWide Developers Conference (WWDC). The company unveiled a facelift for its iOS mobile operating system in what Apple CEO called the biggest change to iOS since it was created. Apple also introduced a line of revamped Macbook Air laptops, as well as a streaming Internet radio service. Investors were not overly impressed by the announcements as the stock sold off nearly 2% from highs to lows of the day.
The rest of the big cap tech sectors shook off AAPL weakness and charged higher. On Friday Amazon (AMZN) broke out of the upper-level channel we highlighted several times in our Off the Charts newsletter, and today it got tremendous (rare) follow-through, finishing up 1.52%. AMZN can tend to be a tricky stock on a short-term basis, but in the past two sessions it has rewarded traders who obeyed technical signals.
Google (GOOG) also continued its resurgence after breaking out of a tight descending channel on Friday. GOOG tacked on another 1.24% today and looks like it has its sights set on all-time highs once again. Google has taken the mantle from Apple as the perceived top innovator in the tech sector, and the stock price of each stock reflects that sentiment.
The solar sector woke back up today, with several stocks in the group making big moves. Sector leaders like First Solar (FSLR) and SunPower (SPWR) were very strong, gaining 6.14% and 9.16% respectively, but were overshadowed by some of the smaller names in the group. After giving back a large portion of their mid-May gains, JA Solar (JASO) ripped 13.49% and LDK Solar (LDK) surged 13.89%. Solar City (SCTY), perhaps weighed down by tomorrow's IPO lock-up expiration, was unable to join the party, and surged only 1.28%.
Overall, it's healthy to see the market rest after a volatile week that included some of the heaviest and most sustained selling of the year. The snap-back on Thursday and Friday was impressive, and now the market finds itself in no-man's land. Traders right now are choosing to be more flexible, as both bullish and bearish cases could be made depending on what indicators your emphasize in your strategy.
*DISCLOSURES: Scott Redler is long YHOO, P, FB, NFLX, BAC. Short SPY.
- Information Technology