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Earnings road kill at Deere and a couple others continue to be little match for bulls cheering over inflation relief. As of 10:47 ET the SPYder” (SPY) and “Cubes” (QQQQ) are up .87% to 1.13% on near-classic expiration-related machinations.

For the bulls and their success plowing of shares higher, the action is mostly the result of inflation relief at the consumer level. CPI and core data both came one-tenth below Street views with slight increases of .2% and .1% respectively. With the latest reading year-over-year total and core CPI figures also dropped by one-tenth to 3.9% and 2.3%. While core levels still remain above the Fed’s comfort zone of 1.7% to 2.0%, analysts do see the data as being an encouraging sign for policymakers.

Speaking of inflation, a decliner of .22 near 101.50 for the US Oil Fund (USO) isn’t going to realistically change the current pinch at the pump for consumers and on corporate profits. And if we’re to believe the latest weekly inventories report which saw supplies increase by a much smaller-than-expected 176K barrels versus estimates of 2.3M; that might not change anytime soon. Nonetheless, with equity bulls’ tone-setting and keeping their collective inflation-filtered eyewear on, any changes in sentiment will likely have to wait for another day.

And speaking of prices again, but seeing more than just potential impact, shares of machinery giant Deere (DE) remain in critical condition. This morning the company issued in-line earnings of 1.74 per share but warned of higher material and freight costs that would double its prior estimates. Shares of DE are off 8 points near 82.10. Separately, disappointments from NASDAQ 100 components Electronic Arts (ERTS) and Whole Foods (WFMI) are weighing in on shareholders but holding little influence on the broader indices. For its part, EA said strong video game sales were countered by a slew of charges, while Whole Foods cited its shareholder bagging was the result of absorbing start up costs related to its Wild Oats acquisition.

Elsewhere, foreclosure filings rose 65% year-over-year and up 4% from March levels to 243,353 properties according to RealtyTrac. The data on the surface sounds quite alarming. And for those homeowners facing the double whammy of still-weak housing prices and possible mortgage resets, it certainly is. However, for the rest of us i.e. the 518 out of 519 households or 99.8% which aren’t facing that brick wall, it seems that point isn’t totally lost on Wall Street. That said though, removing the blinders and gloomy headlines pointing in the other direction seems equally lost on headliner scribes.

One notable area of technical leadership is the solar arena. Spearheading the group, recently IPO’ed Renesola (SOL) hit fresh all-time-highs intraday, currently up 1.85 near 23.55. The company saw a 155% jump in profits to 28 cents per share and a nickel above forecasts. Sales also soared with a triple over the year-ago period and also beat estimates handily with revenues of $123M. Management capped the solid report off by beefing up its full-year guidance and saying it signed a six-year deal for undisclosed terms. Finding sympathy-related bids are First Solar (FSLR), up 10 points near 314 to fresh highs and Yingli Green Energy (YGE), which has earnings tomorrow morning.

Another area finding fresh strength is the semiconductor (SMH) group. No direct news other than the technical variety has been found and maybe, an expiration-related bias for midweek rallies. Intraday the SMH is up .75 at 32.87 and setting year-to-date highs. Shares of KLA-Tencor (KLAC) and Varian (VSEA) are amongst those leading the charge with nary a headline.

And finally, ironically enough on a day when solars are mostly sizzling and the semis are chipping away at higher prices; there’s the hapless Applied Materials (AMAT). Despite being involved in both areas, shares are off .17 at 19.70 following its latest earnings release. The company beat on its top and bottom lines but reported new orders were off 9% from the year-ago period. Additionally, management was cautious going forward and offered a disappointing outlook. It now expects a 25% to 30% reduction in wafer spending versus prior guidance of a 5% to 10% decline. All told, bulls in the stock aren’t really hurting. However, the same can’t be said of their premium-minded counterparts in the options as an expiration of sorts has just occurred.

Chris Tyler
Staff Writer & Options Strategist
Optionetics.com ~ Your Options Education Site
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The information offered here is based upon Christopher Tyler’s observations and strictly intended for educational purposes only, the use of which is the responsibility of the individual. 

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