Market Pulse on May 26th

S&P 500 2991,77 +36,32.

After a long week-end, the stock market opened sharply higher blowing out the 3000 level before retreating towards the close. Breadth closed on a strong note: 3263 stocks advanced compared to 653 that settled down, this did help the cumulative advance/decline line that has started to improve. There is a clear rotation of sectors out of the defensive and the tech towards the badly battered stocks like the financials and the cyclicals. That may help some indexes like the Dow Jones Industrials that may deliver a catch up potential in the near future. Options traders are again willing to play the upside of the market by buying calls. The S&P 500 has a strong support around the 2950 area.