Wall Street has returned from the weekend in a buying mood, with futures on the Dow Jones Industrial Average (DJI) indicating a modestly higher start. It's a quiet day in terms of economic and earnings reports, so investors will turn their attention to the nation's capital. Lawmakers will meet in Washington today to discuss the looming budget sequester -- an $85-billion package of automatic spending cuts set to hit on March 1.
Elsewhere, "The S&P 500 Index (SPX) took out the previous week's highs of 1,514 on Friday," informed Schaeffer's Senior Trading Analyst Bryan Sapp. "Going forward, the next stops will be 1,525 and 1,550 to the upside, while 1,500 and 1,474 remain as support below."
Futures on the Dow Jones Industrial Average are 15 points above fair value.
Equity option activity on the Chicago Board Options Exchange (CBOE) saw 924,613 call contracts traded on Friday, compared to 524,905 put contracts. The resultant single-session put/call ratio fell to 0.57, while the 21-day moving average stayed at 0.65.
From the Trading Floor
"After gapping higher last Monday, the CBOE Market Volatility Index (VIX) bled throughout the week, and is currently hovering near multi-year lows," continued Sapp. "I continue to watch the 14 level as a sign of risk on/risk off. Last week's break lower leads me to believe we have more upside in store."
Currencies and Commodities
Earnings and Economic Data
There are no major economic reports scheduled for today. However, Lions Gate Entertainment (LGF) and Masco (MAS) are due to report quarterly earnings.
The Case for Big Moves in IWM and QQQ
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