Thursday, January 10, 2008
Still Not Happy!
Markets saw a bounce Wednesday after all the indicies hit intraday over sold lows. The Dow gained 146.24 points to close at 12,735.31. The SPX added 18.94 points to close at 1,409.13 (it did go as low as 1378 at one stage). Even the Nasdaq broke its 8 day losing streak!! We are in the green and looking good.
There was good news and bad for Wednesday. Heavy weight chemical giant Dupont announced raised its forecast figures. Also St. Louis Fed President William Poole also provided some positive news when he stated that he expects growth to improve in 2008. This is contrary to the view many economists have that the economy is headed for a recession...but traders didn't care!!
We will get a better idea of how the Fed views the economy and monetary policy when Fed Chairman Bernanke speaks later today.
On the bad side the housing market continues to be a thorn in the side of economic growth with Countrywide Financial (CFC) a casualty of this weakness. The mortgage lender has been hit hard the past few days on rumors the company might file for bankruptcy protection. CFC has denied the rumors, yet the stock has continued to decline. On Wednesday, CFC shares were down more than 15 percent at one time, but closed with a loss of just 6.4 percent.
Finally earnings season kicks off again with Alcoa reported a stronger than expected gain in earnings after the bell yesterday.
This earnings season is going to be critical for the markets. The fact is that stocks have taken a hit to start the year on concerns about the economy and the bad economic data. However, if earnings suggest we are actually entering into a recession and/or economic news worsens, then again....watch out below.
Until next time.
There was good news and bad for Wednesday. Heavy weight chemical giant Dupont announced raised its forecast figures. Also St. Louis Fed President William Poole also provided some positive news when he stated that he expects growth to improve in 2008. This is contrary to the view many economists have that the economy is headed for a recession...but traders didn't care!!
We will get a better idea of how the Fed views the economy and monetary policy when Fed Chairman Bernanke speaks later today.
On the bad side the housing market continues to be a thorn in the side of economic growth with Countrywide Financial (CFC) a casualty of this weakness. The mortgage lender has been hit hard the past few days on rumors the company might file for bankruptcy protection. CFC has denied the rumors, yet the stock has continued to decline. On Wednesday, CFC shares were down more than 15 percent at one time, but closed with a loss of just 6.4 percent.
Finally earnings season kicks off again with Alcoa reported a stronger than expected gain in earnings after the bell yesterday.
This earnings season is going to be critical for the markets. The fact is that stocks have taken a hit to start the year on concerns about the economy and the bad economic data. However, if earnings suggest we are actually entering into a recession and/or economic news worsens, then again....watch out below.
Until next time.
# posted by Paul @ 6:13 AM 
