Bulls Have Great Expectations: Dave's Daily
NEW YORK (ETF Digest) -- There was little news to account for any rally on this Turnaround Tuesday given poor Industrial Production and lower than expected Housing Starts. But, bulls are looking ahead to earnings which have been much lowered and engineered to beat expectations. Goldman Sachs reported a beat ($3.92 vs $3.55 expected) and the stock rallied but now as much as the overall market. The market must smell great earnings news ahead seeing the current global economic softness as buying opportunities. There could also be some fresh money to funds as investors beat the tax deadline. That money gets invested quickly.
IBM just announced earnings that missed top line revenue estimates and stock falls. Intel (INTC) beats lowered estimates but stock is lower in after-hours trading. Yahoo (YHOO) earnings beat estimates and the stock is nearly 2% higher. Of many others, Cree Inc (CREE) shares were lower by almost 8% after its report.
There wasn't much news out of Europe today so stock bears there could take the day off while bulls could play. And, drum roll please... Apple (AAPL) shares rebounded nicely to close above $600 once again.
Bonds were only slightly weaker as stocks rose sharply. The dollar was slightly weaker with eurozone calm and commodity prices (GLD, DBC, USO and JJC) were more or less unchanged. This is a tip that investors are doing some last minute funding of their retirement accounts and commodities aren't front and center.The Argentines know firsthand the rewards of defaulting and rationalizing doing so as the other guys fault. The country defaulted 10 years ago on $94 billion in debt after refusing to enact austerity measures dictated by the IMF. (Sound familiar?) Fast forward 10 years and now with Moral Hazard issues shrugged-off and enabled the country has now seized YPF a subsidiary oil and gas production company of Spain's (as if they didn't have enough problems) Repsol. "You can have my answer now Senator, if you like. My final offer is this: nothing. Not even the fee for the gambling license, which I would appreciate if you would put up personally." Godfather Michael Corleone adapted especially for Argentina's Kirchner reply to Repsol. I guess doing business south of the border particularly in Buenos Aires other than skipping out on your hotel bill, is out of the question now. But corporations have short memories as do other investors. Volume Tuesday was about average, which is to say light, for recent periods. Breadth per the WSJ was quite positive. Join the conversation on twitter and facebook. SPY - The SPDR® S&P 500® ETF is a fund that, before expenses, generally corresponds to the price and yield performance of the S&P 500 Index. Our approach is designed to provide portfolios with low portfolio turnover, accurate tracking, and lower costs.
See more details IWM - The iShares Russell 2000 Index Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the small capitalization sector of the U.S. equity market as represented by the Russell 2000 Index. The index represents the approximately 2,000 smallest companies in the Russell 3000 Index.
See more details QQQ - PowerShares Capital Management LLC is passionate about our goal of delivering the highest quality investment management available through one of the more benefit-rich investment vehicles ever created, the exchange-traded fund. PowerShares QQQ¿, formerly known as "QQQ" or the "NASDAQ- 100 Index Tracking Stock®", is an exchange-traded fund based on the Nasdaq-100 Index®. The Fund will, under most circumstances, consists of all of stocks in the Index. The Index includes 100 of the largest domestic and international nonfinancial companies listed on the Nasdaq Stock Market based on market capitalization. The portfolio is rebalanced quarterly and reconstituted annually.
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