The market is sharply higher in early trading, following strong overseas action. Asian markets were higher overnight after China's PMI report showed a little cooling, which eased fears of tighter monetary policy. In Europe, upbeat earnings from some of their largest banks helped boost markets.
Here in the U.S., the ISM Manufacturing Index for July rose to 55.5, better than the 54.2 that was expected.
The dollar is lower again, and this is helping boost commodities. Oil prices are above the $80 level near $80.85; and gold prices are up a bit to $1187.
Among the sector ETFs, energy is leading the way (+3.0%), followed by materials (+2.20%); consumer staples are lagging (+0.85%), but all 10 major sectors are higher.
The 10-year yield is bouncing from Friday's of the 2.90% level, currently up to 2.95% (which is still a low level overall); the volatility index is down -4.85% to 22.35 currently (last week's low was 21.86).
Trading comment: Last week I suggested that if the S&P 500 could just consolidate in a benign fashion after running into resistance at its overhead 200-day average, that it would probably be in good shape to make another stab at it. Today that is what we are seeing. The SPX has spiked through that level (currently at 1114). This is very positive action. And market breadth is solid with upside volume levels running near 90%.
Additionally, the S&P if it stays up here is now back into positive territory for the year. That will start to put increasing pressure on portfolio managers to put cash to work to continue to keep pace with the averages.
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