Friends
Considering we had a somewhat disappointing GDP number this morning coupled with a downgrade of Spanish debt by Standard and Poor’s, one would have expected a downward bias to stocks as the trading day began. On the contrary, instead, stocks posted gains for the 4th day in a row. To date we have had about half of the S&P 500 report earnings, and as we have been pointing out for days now, corporate America is once again beating expectations (yes the expectations had been ratcheted down, but a beat is a beat).
For the day, the Dow Jones Industrial Average was up 23 points to close at 13,228. The S&P 500 was up 3 points to finish the day at 1403. Gold was up about $3 for the day to finish trading around $1663 per ounce, and oil was virtually flat trading near $104.73 per barrel WTI. It was nice to finish the week above the 1400 mark on the S&P 500. If we can hold that early next week, we might be able to build on this mostly positive earnings season.
A little more color on the GDP number. A drop in Government spending was the main reason that we saw a slowing in the GDP from the previous quarter. On the other hand, a moderate acceleration in consumer spending was a positive sign. Expectations were for a number near 2.5%, but instead the number came in at 2.2% vs. the 3% that we saw last quarter. Again, the economy is growing, but at a very deliberate pace, and one that may not be able to create new jobs.
All in all, it was a pretty good week for stocks. Let’s see if we can build on it next week as we wait for Friday’s job report.
Have a nice weekend everyone.
