Stocks Rebound, Within Striking Distance Of New Highs

Great day in the markets yesterday with all of the major indexes in the green. The small-cap Russell 2000 Index, once again, led the way.

Stocks shrugged off the emerging market 'so called' crisis, which really is just a crisis for Turkey. And they shrugged off tariff concerns, as they have been, as the bark at this point is far worse than the bite.

And the profit taking, which weighed on stocks since late last week, might have finally run its course. And stocks remain within striking distance of new all-time highs.

In other news, retail sales via the Redbook numbers showed same store sales up 4.5% y/y. This was off from last month's pace, but still up solidly.

The Small Business Optimism Index increased from 107.2 to 107.9. Analysts noted this was the second highest level in the survey's 45-year history.

And the Import and Export Prices showed import prices rose from a 4.3% y/y change to a 4.6% y/y change, while export prices declined from a 5.3% y/y change to a 4.3% y/y change. Details show that the gain in import prices was driven by an increase in oil prices. Excluding oil, import prices actually fell -0.1%. As for exports, the decline in prices came mostly from agriculture. All in all, the report shows that inflation is not much of a concern.

Later on today we'll get some meatier reports with MBA Mortgage Applications, more Retail Sales numbers, the Empire State Manufacturing Survey, Industrial Production, and Business Inventories.

In the meantime, the market looks great. And it should given the great economy.

See you tomorrow,

Kevin Matras

Executive Vice President, Zacks Investment Research

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