Stocks Market Only As Strong As Latest Data

STEPHEN BERNARD

NEW YORK (AP) — There's a tug of war in the financial markets between investors who believe the economy is on its way to a strong recovery and those who believe a rebound is likely to be slow and bumpy.

The result: a spate of volatility in stock trading that's likely to continue this week.

"That wide divergence in opinion can lead to wide swings in market prices," said Greg Walker, an investment strategist in JPMorgan Chase & Co.'s private banking division.

For the past several weeks, upbeat investors have dominated the market, helping stocks move higher. However, the market's momentum is only as strong as the latest economic or earnings report.

This week brings reports including readings on retail sales, manufacturing, housing starts and inflation. The Labor Department also provides its weekly look at unemployment benefits claims.

Tom Villalta, lead portfolio manager of the Jones Villalta Opportunity Fund, said economic reports are playing a heavy role in the day-to-day gyrations of the market as investors look for evidence to back up their views on the recovery.