Early Look: Waiting On Google

The market is pushing higher in early trading, adding to its oversold bounce that started yesterday. The S&P 500 is back above its 50-day average, which comes back into play around 1374. Bulls will be looking for the index to hold above that level.

In earnings news, tech giant Google (GOOG) reports earnings after the close tonight. Consensus estimates are for EPS of $9.64 on revenues of $10.58 billion. Last quarter, GOOG missed estimates with its earnings report and the stock gapped lower the next day. Let's hope they have a better handle on their financials this time. The stock is trading at roughly 15x 2012 estimated earnings, so it's not very expensive at current levels.

In economic news, core PPI data showed a 0.3% increase month over month, slightly above expectations. Also, jobless claims came in higher than expected at 380,000. But continuing claims declined.

Overnight Asian markets were higher, led by a 1.8% bounce in China. Europe's markets are mostly lower this morning.

The euro is higher vs. the dollar, which is helping commodities. Oil prices are rallying to $103.80, and gold prices are up to $1676. Copper and silver prices are getting a pop as well.

The 10-year yield is up a touch to 2.03%; and the VIX is down -8% currently to 18.41. Yesterday's early dip in the VIX reversed itself by the close and the VIX rallied back up to 20. We'll see if it can stay down on day 2.

Trading comment: Yesterday's bounce came on somewhat lighter volume, but it was still a good rally attempt. Bulls will be watching for some follow through to come on higher volume, and also for one of the minor growth indexes (like the S&P midcap 400) to recapture its 50-day average. Most leading growth stocks haven't had too much damage on the charts and are consolidating. LNKD is close to breaking out again, and could benefit from the social media hype that is picking up as Facebook readies for their IPO next month.

KAM Advisors has long positions in GOOG and LNKD