Friends
With a week to go, we have had a very nice advance in the stock market for the month of October. Of course, news out of Europe could derail us a bit next week, but nevertheless a good 3 weeks is a good 3 weeks. Traders don’t seem to be “buying” this advance and continuously express their doubt, and in some cases disdain, for the recent up move. As always, beware of those pundits on TV. They are always “talking their book”. Perhaps, they were just a little under-invested before this move and are feeling the pain. Anyway, since the 1072 low on the S&P 500 on the morning of Tuesday Oct. 3rd, the index is up more than 15%, and up about 12.5% from the 1099 close on Monday, Oct. 2nd. That is quite a move in a 3 week period.
For the day, the Dow Jones Industrial Average was up 267 points and the S&P 500 was up 22 points to close at 1238. Gold was up $28 for the day and oil was up $1.56 WTI to close at $87.63. The emphasis behind today’s move was continued hope that by next Wednesday the Europeans will have a roadmap to solvency to show us, and also there was a hint of more Fed easing which would entail mortgage securities. Additionally, earnings continue to come in, with now about 75% of the reports beating analysts’ estimates. Nice reports from McDonald’s and Honeywell helped provide the good karma for today’s early action, and stocks held the gains throughout the day.
We are going to have a lot of macro news next week concerning Europe, and it is likely stocks will take their cue more from that than from next week’s earnings news. We’ll keep an eye on it all and try to keep you informed of next week’s developments. It should be interesting.
Have a great weekend everyone.
