Dow and global market drop expected.
Once again, the Dow inches toward the 10′ milestone. The week in decline is expected.
Those who follow us, will have noticed our tweets about premature optimism throughout this year.
Are you ready for US GDP at 1.4%?
The last two months have been a bit of a rollecoaster ride. Ok, maybe not a ride with huge ups and downs but still.. the trend has been shifting from day to day. The sum of it, though, is that we are backtracking again. It is only 10 days ago that we closed above the 10,700 mark.
The markets have been trying to breathe life into the Dow supported by positive corporate reports but at the same time, the general economic news and forecasts are anything but upbeat. As we have been proposing for quite a while now, the optimism that was broadcast before summer was premature.
If you look beyond the national borders, the outlook is in many places even gloomier for the fall and winter of 2010.
Trading on hope (specially if it is someone elses hope) is never a good idea. If you trade, do so safely and capitalize on the current turbulence. We propose that news and the big, national/regional fundamental numbers will have a more marked effect on the direction of the Dow and other markets, that corporate gains.
Little has been said about the state of the European Union after the bailouts earlier this year but EU has more troubles which we expect to surface during fall 2010.
Conference Board indicates Lower Consumer Confidence
The private research group Conference Board has pointed to a lower consumer confidence index with as much as 4 percent compared to June this year.
This is the second month that consumer confidence index falls. June showed around a 9 percent drop.
Futures were high this morning but current trading is once again sideways as the market weighs in the fact that the consumer – which means the source of all economy – is not too happy about what the future (6 months) might look like on the job market.mm
Markets are looking stronger this week
Futures are up and we expect Dow Jones to open with an extension of the rally we have seen these last market days. Do we gain another 100 points?
There are a lot of indicators supporting a gain with US housing data lifting most Asian markets. European markets are also up. The S&P index is above it’s 200 day average and there are a host of earning reports due such as US Steel, Lockheed, Lexmark, Cit Group, DreamWorks and several others.
Keep an eye on the July consumer confidence report offered by Reuters and Michigan University that is due on Friday.
Seems like a Bull week 
