Friends
Wow! What an end to the week. After three miserable days for markets late last week and early this week, stocks staged a fierce 3 day rally based on the hope that central banks here and abroad are prepared to fill the liquidity punch bowl to the brim. With the hope that the ECB’s Mario Draghi is cooking up a plan to save Europe, and here at home Dr. Bernanke is about to unleash QE3 on us next week, stocks rallied early and often. Never mind that the first look at 2nd quarter GDP showed that the U.S. economy grew at only 1.5% (believe it or not, that is a little better than we expected) and consumer sentiment numbers were just flat from last month. Everything on my screen was green today (that’s the good color) with the exception of Facebook (why that is on my screen I don’t know, but you know what they say about watching a train wreck and you just can’t turn away). I can’t remember the last time I saw so much green.
Anyway, for the day, the Dow Jones Industrial Average was up 188 points to close at 13,076 (it’s nice to see the Dow above 13,000 again). The S&P 500 was up a whopping 26 points to finish the day at 1386. Gold was up $8.80 to trade at $1623 per ounce, while oil was up $.71 to trade at $90.10 per barrel WTI. Sure company reports from the likes of Starbucks and Facebook were disastrous, but traders were only focused on central bankers today.
Next week we get the FOMC meeting beginning on Tuesday. Is this a buy the rumor and sell the news situation? I am not sure, but the market is expecting a whole lot of cowbell next week. How will markets react if they get it? How will they react if they don’t get it? It should be wild next week. Stay tuned.
Have a great weekend everyone.
