Bernanke is testifying before Congress in his semi-annual monetary policy hearing, and in his remarks he said that the Fed stands by to provide additional monetary stimulus (i.e- QE3) if economic conditions warrant it. This boosted sentiment in stocks, but also led to a rally in commodities.
Commodities are higher across the board. Gold prices have hit new highs above $1585. Oil prices, which started yesterday below $95 have rallied back above $98. Ag commodities are higher today as well.
China released its Q2 GDP figures last night, which showed its economy grew 9.5%, above expectations. The data helped Asian markets rally overnight, and also boosted European markets this morning, briefly diverting attention from the debt issues.
The 10-year yield is higher today at 2.94%; and the VIX is falling -8% back to 18.22.
Trading comment: The SPX hit its 50-day average yesterday and has since bounced higher off of it. I continue to look for stocks that are breaking out to new highs and leading the market. Here is a short list of some of them: ALXN, LULU, PNRA, GSM, PTEN, and there are a host of others that are close to breaking out. Keep an eye on them, as they could be part of the new leadership among stocks if the market stays firm.
long ALXN, PNRA
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