Everything continues to revolve around oil after we got licked pretty good yesterday. Everything is a knee-jerk reaction now.
The two major hurdles continue to be oil and interest rates on the Treasuries. The market has demonstrated through the first quarter that we can snap back.
The key this morning is the 10-year note hovering around a yield of 5%. This news trumps any economic or earnings data. It's a rate-driven market, even with oil competing for headlines. Any weakness we may see will be due to these bond yields.
It's an earnings-driven market. The big question is whether the flow of earnings can rescue the market from the twin dreadnoughts of higher oil and interest rates.
The earnings numbers are still respectable, but they are softening. The psychology is that you can't make projections about future earnings without having some sense about where the price of oil is going and what the consumer will do.