Existing U.S. home sales climbed in April as consumer confidence rose. Reports say GM is close to bankruptcy as tech stocks gain Wednesday. What does this mean for the stock market?
Art Cashin, UBS Financial Services director of floor operations, offered CNBC his Wednesday insights.
Cashin said the rally yesterday (Tuesday) was driven by several factors: "All the talk of 'green shoots'...and we had a 12-week rally."
"We came in looking at the low end of the range. There was a previous double-bottom from [May] 15th and the 18th. The shorts were shoping that if they broke, we'd get some trap-door selling. Instead they held."
These pre-conditions then "buttressed" the market ahead of the confidence numbers — which put on "the retro-rockets" and drove the rally.
Cashin said investors should now be watching numbers from retailers like Target, to see if Tuesday's rally revealed a "sigh of relief without any money behind it."
He has two concerns now:
"The one I'm most worried about" is Thursday's Treasury auctions, Cashin said. "It's kind of a strange one," as the Federal Reserve is expected to buy Treasurys that will mature in three to five years.
"I'm a little worried about one other thing," he added. "More and more stocks are beginning to slip below their 50-day moving averages. That's a sign of internal weakness." (Counterpoint: Dick Bove says Big US Banks Are ‘Definitely Out of the Woods’)
More from the master:
CNBC's Companies in the News:
Bank of America
PNC Financial Services
Disclosure information was not available for Cashin or his company.