This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Jobs Report to Test Bulls in Coming Week

Stocks in this article: AAPL BBY PSMT ^DJI ^GSPC

NEW YORK ( TheStreet) -- The second quarter of 2012 has a lot to live up to but investors can take some solace in the fact that it's got history on its side.

Research firm Birinyi Associates noted earlier this week that the S&P 500, which finished the first quarter up 12%, usually books a respectable gain in the quarter following 10%-plus rise in the previous three-month period. According to Birinyi, the index has tacked on an average of 5.2% in the quarter following a 10%-plus gain and finished positive 88% of the time since 1962.

If said 10%-plus gain comes in the first quarter, the S&P 500 has averaged a 3.4% advance and been up 86% of the time.

"We are frequently asked what is 'going to be different,' or for 'themes' in the next month, quarter, year etc.," Birinyi said. "Our response has always been that the market pays no attention to the calendar, rather moves in cycles. With that being said, we expect more of the same as we start the second quarter."

Michael Gayed, chief investment strategist at Pension Partners, also feels bullish about the coming quarter. He cites narrowing credit spreads as evidence of tremendous market resilience despite Greece effectively defaulting, slow growth in Europe, and fears over a China slowdown.

"Financials continue to lead markets higher, indicative of growing investor confidence that the financial crisis worldwide is nearing its end," says Gayed.

The most important thing to pay attention to going into the next quarter is fund flows, to see if the "Spring Switch" out of risk-free assets into riskier assets occurs, says Gayed.

Ken Shreve, a RealMoney contributor and financial markets commentator, says that after the big run-up for the market, he's been playing more defensively than offensively. While he's not looking to add new names to his model growth portfolio, he's also willing to let what he owns right now continue working.

"Until I start to see meaningful signs of institutional selling in some of the big leaders -- a name like Apple (AAPL) for instance -- I'm in no rush to head for the sidelines."

Right now, Shreve is getting mixed signals on underlying market health. Heading into Friday, the broad-based New York Stock Exchange Composite Index showed seven higher-volume declines in recent weeks, which points toward at least some institutional selling, he says. There have been five events of higher-volume selling in the S&P 500 and four in the Nasdaq, he says.

"There is still a bid underneath this market as under-invested fund managers continue to put money to work," Shreve explains.

1 of 2

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 18,053.71 +23.50 0.13%
S&P 500 2,088.77 +6.89 0.33%
NASDAQ 4,806.8590 +33.3870 0.70%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs