Commenting on the stability of the oil price and today’s trading, Gorilla Trades strategist Ken Berman said:
The major indices are all trading slightly higher at midday as stocks bounced back following yesterday's late-session dip in early trading. The Nasdaq has been the strongest of the large-cap benchmarks yet again this morning with Apple (AAPL) showing notable relative strength and hitting a new all-time high. The U.S. reported another daily record in the number of confirmed COVID cases, with Texas and Florida both reporting over 10,000 infections in the past 24 hours and that continues to weigh on risk assets despite the pre-market bounce.
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Crude Oil Inventories Surge But Oil Price Remains Stable
In economic news, U.S. crude oil inventories surged higher by 5.7 million barrels following last week’s historic plunge, but the price of oil remained stable following the release amid the positive shift in investor sentiment. The European Union’s (EU) economic forecast was more bearish-than-expected, but interestingly that led to a rally in the euro, as investors think that the weak outlook makes it more likely the EU’s historic stimulus package will be approved later on this month.
Dow: 25,901, + 11 or 0.04%
S&P 500: 3,146, + 1 or 0.02%
Nasdaq: 10,389, + 45 or 0.4%
Russell 2000: 1,447, - 6 or 0.4%
Market breadth has been in line with the performance of the large-cap benchmarks, with advancing issues outnumbering decliners by a 3-to-2 ratio on the NYSE. Only 12 stocks hit new 52-week lows on the NYSE and the Nasdaq, while 113 stocks hit new 52-week highs. The major indices have been trading below their daily VWAPs (Volume-Weighted Average Price) throughout the morning session, pointing to intraday selling pressure. The key cyclical sectors have been lagging behind the large-cap benchmarks, and the Nasdaq in particular for the second day in a row, but the traditional safe-havens were also relatively weak, with only the tech giants showing strength, so the “great divide” between the sectors is still apparent. Stay tuned!