Overnight markets were mixed, with Asia slightly lower and Europe higher, as the Europeans were once again able to shrug off the consequences of the PIIGS debt fiasco. Likewise, the stock market here was modestly higher, with yesterday's bit of angst regarding the potential for an S&P downgrade quickly forgotten, as folks turned their attention to earnings season. (I don't mean to imply that I think S&P or Moody's are very insightful or useful, and thus should garner respect, but they did state the obvious for all to hear.)
I was curious to see how the market would respond to Texas Instruments' quarterly report, as it was forced to take guidance down for next quarter not just because of Japan, but also weakness in other areas. However, the stock was hardly affected, trading down about 1% early on and actually turning positive at one point during the morning.
Attitude Adjustment
The information in that, of course, tells us it is still not safe to be short, because by all rights TXN should have sunk. Some folks may say that the markets did not respond to good news either, as Goldman Sachs' stock didn't trade higher after winning at beat-the-number. And while that may be true to some degree, when stocks don't decline on bad news that is more telling (regarding potential success on the short side) than their not rallying on good news.
Thus, despite all of the enormous problems facing the U.S. and Europe, it continues to be the case that shorting is not particularly productive yet, though that does not mean we aren't in the process of making a top.
Turning back to the action, the market rallied a bit more in the afternoon and closed on the high, recouping about half of yesterday's losses (ex the Nasdaq, which lagged).
Away from stocks, bonds were flattish, oil added 1%, and the dollar was back to sinking. The metals were both green and red before silver led the way higher, gaining 1.5%, while gold was just slightly stronger.
