S&P futures are roaring in pre-open trading this morning, up nearly 4% after George Bush spoke live and gave further support of the government's latest strategy to inject $250 billion of capital directly into banks by buying up shares of their stock. This is widely considered the most reasonable plan to date because the government will be buying up shares at fair market value, unlike the bad paper they had initially planned to purchase and remove off of the banks' balance sheets.
In my infancy of day-trading, I have quickly learned that pre-open trading certainly carries no guarantees for how the market will open and trade for the day, but a 4% gain pre-open is certainly something to raise you out of your seat for the time being.
In other news, Johnson&Johnson (ticker JNJ) beat earnings as I expected, and they are trading up $3 at nearly $66 a share pre-open. Also, JP Morgan (ticker JPM) is trading up over $2 a share at $44.25 this morning pre-open, which eases my concerns from yesterday when they, along with MTB and USB, were trading against the positive surge. The rest of the financial sector is following suit, with Goldman Sachs (ticker GS) leading the way with pre-open gains of $16/share. AAPL is seeing nice gains as well, trading up over $5 at $115 a share.
All of this activity is extremely positive going into today's trading, and I believe investors are finally becoming confident that the goverment's oversight of this credit crisis will FINALLY begin to start paying dividends. Remember though.......be extremely cautious in how you read pre-open trading, as it can often times be very overextended in either direction. That being said, I still believe we will see the Dow retrace some of its gains from yesterday, but nothing outside of 1%.
And before the opening bell rings, I must ask for a long round of applause for my Phillies, who pulled out an improbable win last night to go up 3 - 1 in the NLCS. We can thank Joe Torre's pathetic bullpen management for that one. One more game..........lets go Phils!
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