After bouncing above and below their opening prices today, the three major indices finished in the green. The DOW gained 26 points, the S&P 500 managed to be a fraction higher, and the NASDAQ rose 27 points. For the month of January 2017, all three indices ended with gains: the DOW advanced by 0.5%, the S&P was up by 1.8%, and the NASDAQ was the big hero last month with a 4.3% jump. This was its best performance since last July. Even the Russell 2000 Index managed to eke out a small gain in January with yesterday’s positive performance. This was also the third month in a row that these averages showed gains.

There were a number of economic reports yesterday with the January Consumer Confidence making a slight decline. However, it remained near a 15-month high. The January Chicago Purchasing Managers’ Survey declined down to 50.3…its lowest level since April 2016. The Case-Shiller Home Price Index for January rose by 5.7%.

Today was a reversal of the prior two days’ pattern; instead of starting low and then cutting those losses into the close, the major indices opened very strongly today as a result of euphoria over the earnings report from AAPL. The company has now reached its best price level since last summer.

Breadth numbers were negative at a 14/16 downside ratio. The VIX ended 1.5% lower at 11.81.

Economic reports today showed that the ADP estimate for Friday’s jobs report was an upside shocker at 245,000. The consensus was 175,000. The report led to a stronger dollar for a change and the Euro fell down a little to 1.077. Other reports showed that the January ISM Manufacturing Survey rose to its best level in more than two years, also helping the dollar to strengthen. The yield on the 10-year Treasury Note to back over 2.50% at 2.51%. This helped shares of bank stocks and a few regional ones have reached all-time highs. For what it is worth, December construction spending fell by 0.2%.

Donald M. Selkin

These are excerpts from Don Selkin’s Daily Market Notes, abbreviated and updated with permission from the Author. Don Selkin is the Chief Market Strategist at Newbridge Securities Corporation, member FINRA/SIPC and provides the Fair Value analysis for CNBC each morning.  The commentary provided in this Market Letter is intended to provide our customers with timely market analysis and should not be considered a research report.  This Market Letter may contain, and is limited to: Discussions of broad based indices; Commentaries on economic, political or market conditions; Technical analyses concerning the demand and supply for a sector, index or industry based in trading volume and price; Statistical summaries of multiple companies’ financial data, including listings of current ratings; and, Recommendations regarding increasing or decreasing holdings in particular industries or securities.  This Market Letter does not make a financial or investment recommendation or otherwise promotes a product or service of the firm.   This Market Letter contains only news, facts, and commentary on information previously reported from a news source believed to be accurate and reliable by the author.  These news sources include the following:  {Bloomberg Financial, Reuters, Associated Press}.