Stock Market Commentary for Monday, May 9, 2005

[Some minor changes in the actual column since Saturday]

The monthly employment report certainly got a lot of attention on Friday, but the stock market response was rather muted. Actually, that's a good thing since it makes little sense to get too excited by a single report. Nasdaq rose a modest 5.55 points.

Unfortunately, Nasdaq closed well below both it's high for the day and its opening level as well. That's a moderate yellow flag, suggesting that there is still a fair amount of "sell into any rally" sentiment in the market. The good news was that we finally set a new high above the April 21 intra-day and closing highs, at least superficially breaking the bearish trend of "lower highs" and changing it to the bullish trend of "higher highs", but we need to see some real follow-through to build a durable trend.

The economic data has been reasonably decent, suggesting that the economy is at least limping along and may in fact be picking up at least a little steam.

Nasdaq trading volume was very light (1.54 billion shares), and breadth was modestly positive, with 1.10 gainers for each loser.

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-- Jack Krupansky