9 Temmuz 2010 Cuma

Google Gets Its China License Renewed

The market is higher again in early trading. If it were able to close in positive territory, it would mark the 4th consecutive daily advance this week, which is a welcome change from the price action of the last few weeks.

There are no major catalysts this morning in the form of market moving news such as earnings reports or economic data. One news item that is getting attention is that Google (GOOG) announced that the Chinese government renewed its Internet license. The news is boosting shares of GOOG +2.5% so far.

Asian markets were higher overnight, despite the announcement that the Bank of Korea hiked interest rates 25 basis points to 2.25% in a surprise move. Korea becomes the fourth Asian central bank to hike rates in the past month, illustrating that their economies are still experiencing stronger growth than most of the developed nations.

The dollar is a bit higher this morning, but so are oil and gold prices. Oil is slightly higher near $75.66, and gold is back above the $1200 level at $1211 currently.

Trading comment: We did a little bit of selling yesterday in a couple of ETFs and mutual funds that we own. After such a strong 3-4 day rally, the market likely will see some backing and filling in the days ahead. But I would not be surprised to see another push higher at some point that would push the major indexes closer to their downtrending 50-day averages. Those are levels that would present a better opportunity to get more defensive.

Of course, earnings season starts next week, and even if companies meet estimates, the reaction in stocks is going to depend on what management's say in their guidance and whether forward estimates prove overly optimistic. Have a good weekend.

long GOOG

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