The Dow Jones Industrial Average (INDEXDJX:.DJI) is on pace to extend Monday's triple-digit advance, with futures pointed solidly higher ahead of the bell. Investor sentiment has been given a boost by reports suggesting Syria may be open to surrendering its chemical weapons. Also adding to the bullish buzz is a round of upbeat economic data out of China. Against this backdrop, the blue-chip barometer is eyeing a 73-point pop right out of the gate.
Elsewhere, "The S&P 500 Index (SPX) finished above its 50-day moving average yesterday, and is closing in on its May highs near 1,675," noted Schaeffer's Senior Trading Analyst Bryan Sapp. "This will be the next hurdle for the bulls to overcome. Below that, the index should have some support at 1,650."
Futures on the Dow Jones Industrial Average 2 Minute (INDEXDJX:.DJI) are roughly 73 points above fair value.
The Chicago Board Options Exchange (CBOE) saw 1,057,353 call contracts traded on Monday, compared to 479,336 put contracts. The resultant single-session put/call ratio fell to 0.45, and the 21-day moving average dropped to 0.57.
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"Last week's Investors Intelligence (II) and National Association of Active Investment Managers (NAAIM) sentiment reports showed that, despite the recent bounce, money managers are still skeptical of the market," continued Sapp. "Allocations are lower than what we saw only a few months ago, and the VIX continues to trade well above this year's lows. This is a sign of continued disbelief toward the market."
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Earnings and Economic Data
The NFIB Small Business Optimism Index is on the calendar for today, while Christopher & Banks (CBK), Coldwater Creek (CWTR), and Oxford Industries (OXM) will enter the earnings confessional.
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