By Kevin Grewal, editorial director at www.SmartStops.netAs second-quarter earnings reports continue to beat Wall Street expectations and news reports show signs of an economy on the mend, gold seems to be losing its luster. Four factors are behind the brighter market outlook.
EarningsChipmaker Intel ( INTC) reported better-than-expected earnings Tuesday afternoon on an increase in revenue that suggests consumer spending on personal computers is more than what analysts had expected. Additionally, it bumped up its third-quarter revenue forecasts to a range higher than what technology analysts had anticipated. What does this mean? As we all know, consumer spending is a driving force behind an economic recovery and this "bottoming out" in the personal computer industry could potentially be the start of an upward trend in consumer spending. INTC has seen a nice rally from its March low of $12.08 to close at $16.83 on July 14, a jump of 39%. The better-than-expected earnings reports are not only logging gains in U.S. markets, but they have trickled down to global markets as well.
RetailIn June, retail sales increased by 0.6%, marking a second consecutive increase for the sector. Most experts agree the surge in the sector was primarily driven by hikes in energy and gasoline prices. This uptick in sales indicates that consumers are starting to let go of the tight grip they have on their wallets and spending a bit extra. The Retail HOLDRs ( RTH) Retail HOLDRs has seen a nice rebound of nearly 26% after witnessing a March low to close at $77.19 on July 14.