Market Commentary for Monday, February 28, 2005

[The main column has been updated since Saturday.]

Friday was another one of those tentative trading sessions where people stand around wondering which way to play the market and then gradually an underlying trend becomes more apparent.  The market was almost flat and with a slightly negative tone until shortly after 11:00 a.m. when the rally took off and the tone began to change.  Nasdaq gained a moderate 13.70 points.  That seems like a nice gain, but volume was rather lean and sometimes we see rallies on Fridays that are driven primarily by short-term speculators who don't like to have open positions over the weekend.

The economic data was reasonably decent.

Here's a correction for Briefing.com's Market Update:  They wrote "The Nasdaq closed higher for the week but finished 23 points shy from a new 2005 high."  Make that about 85 points to the January closing high and about 110 points to the closing level of 2004, and about 125 points to the intra-day peak of 2005 (which was on the first day of the year).

It's worth noting that the one-month Nasdaq trend is now modestly positive (for a second day) for the first time this year.

Nasdaq trading volume was barely moderate (1.78 billion shares), and breadth was moderately positive, with 1.87 gainers for each loser.  This was not a strong rally, so we shouldn't take much comfort from the moderate gain.

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