Wall Street appeared to be on shaky ground last night after the overseas markets traded lower following the news North Korea had launched more artillery. Futures were down about a third of a percent but like we mentioned this morning, were improving as we headed for the gates.
The start by the bulls today has been slow and steady and what we wanted to see. A close above some key round numbers would be bullish for a few more days of fluff. We continue to mention Friday as a pivotal trading day and while February expiration day has been bearish in recent years, we could get a reversal if some of this week’s headlines are positive.
The first hurdle the bulls will have to clear are the President’s remarks in the State of the Union address tonight that could impact trading on Wednesday. Some of the Fed heads will be making statements as well so the political rhetoric will be in focus a little this week. Earnings continue to come in better-than-expected with some big winners today.
Michael Kors Holdings (KORS, $62.69, up $5.69) is one of them and is up a cool 10% after beating Wall Street’s estimates while raising full-year guidance. There were a lot of shorts who may have got squeezed-boxed in this name as they were betting for a miss or lowered guidance but this company is firing on all cylinders and their execution is flawless. This company could be a winner for many years to come and we wouldn’t be surprised to see shares make a run at $100 over the next 6-12 months.
There are a few earnings trades we have listed for this week but we will likely stay on the sidelines as we try to protect profits and play safer trades. We have taken a few swings on earnings trades with split results but overall we are up. Some of our current trades are getting nice pops so let’s go check on them. We also took one on the chin with our Fossil (FOSL, $112.56, up $5.10) earnings trade that we left open from December.
As we head to press, the Dow is up 37 points to 14,008 while the S&P 500 is advancing 2 points to 1,519. The Nasdaq is lower by 3 points to 3,188. Subscribers, check the Members Area for the updates and we will be back in the morning with a full report.