Costco Reports Tomorrow As Investors Examine Ralph Lauren, Toll Brothers Today


It seems fitting that as the U.S. prepares to launch astronauts into orbit today for the first time in almost a decade, the stock market has been rocketing higher for weeks.

SpaceX is planning to launch two astronauts this afternoon just after the closing bell, weather permitting. SpaceX is privately held, but if the U.S. is back in outer space to stay, that could be good news for companies with a space presence like Lockheed Martin Corporation (NYSE: LMT), Boeing Co (NYSE: BA), and Northrop Grumman Corporation (NYSE: NOC), Barron’s pointed out yesterday.

Back on the ground, it looks like the countdown is on for a launch from where things left off Tuesday on Wall Street. Major indices and some of the airline and travel stocks are up in pre-market trading. The question is whether the S&P 500 Index (SPX) can register its first 3000 close in nearly three months after just missing that yesterday.

Optimism continues to be the word of the day despite some worries about the U.S./China trading relationship and obviously concerns about any potential rebound in virus cases. There’s a sense among some market participants that the worst is behind us as people get back to work.

At the end of the day, it’s important for investors not to get ooled into a sense of complacency. If a trade war gets going, for instance, this isn’t a super-strong U.S. economy that can necessarily withstand that kind of body blow the way i mostly did last year. We were a healthier economy at that time. China’s economy is more fragile now, too.

Investors look ahead to the Fed’s Beige Book later today. Earnings to consider watching Wednesday include Ralph Lauren Corp (NYSE: RL) and Toll Brothers Inc (NYSE: TOL).

Some big retailers including Costco Wholesale Corporation (NASDAQ: COST) report on Thursday. One thing to consider listening for on calls of companies like COST is whether executives think crisis-related stock-up demand pulled some sales forward, which could potentially detract from results later this year.

Chase for 3000 Stalls…

The first test of 3000 in almost three months came up a little short yesterday. So today we’ll see if the S&P 500 Index (SPX) can get back above that level, where it hung out for most of Tuesday before some late-session selling.

Nine of 11 sectors rose yesterday, but Information Technology was a laggard. That sector has been on such a run that a little pause for breath doesn’t seem all that worrisome, though it did keep the Nasdaq (COMP) from joining in the gains posted by other major indices.

The sagging finish yesterday couldn’t really dent what was a pretty amazing start to the new week. A little profit-taking at the end of the session probably won’t alarm anyone too much, though the late retreat might also have reflected concerns about China. It would have been technically positive to hold onto those gains above 3000, a level that  lines up pretty closely with key resistance at the 200-day moving average for the SPX (see more below).

…But Not for Long

People didn’t have too long to regret the late slip below 3000. The SPX looks like it’s going to start today well above that. The question is whether those gains can hold. Closing above 3000 today and for a few more days would likely help cement those bullish feelings.

After the close, investors got two new pieces of what might …

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