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Will we sustain this level or even a better one?
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We had a profitable business week.As I predicted before, the company earnings are more than satisfactory and it will continue to be so this week. We might even surpass 13,000 and continue the rally. However, the good days coming to an end soon. From my point of view, the optimistic financial situation is unsustainable.The high stock market,good growth and business investment will provide the ground for Fed to raise interest rates. I think this week we will see the final stage of the rising stock market. It is stil possible to make Money this week too.However it is getting riskier. I would expect (this) week to see a little bit of consolidation.
I wouldn't be surprised to see a little bit of profit-taking.
Then it is time to see the reality: high inflation, moderate growth and unsustainable stock market. I will say let it go for this week except oil company shares and I will be cautious to make further investments.Actually, it might be time to consider short positions.
As the Dow industrials approach 13,000 for the first time, investors will keep a close eye on the heavy flow of quarterly earnings while new data on consumer sentiment and the pace of the U.S. economy stream this week.U.S. stocks jumped on Friday, with the Dow closing at a record high after coming within 35 points of 13,000 as stronger-than-expected earnings reports poured in.
The Dow Jones industrial average may have difficulty breaching this key level, however, given how strong indexes have been in recent weeks and the temptation for investors to take profits.
In the past week, the Dow rose 2.8 percent, the S&P gained 2.2 percent and Nasdaq rose 1.4 percent.
Strong corporate earnings from companies like Google Inc. and Caterpillar Inc. have handily beat expectations and have left April on course to be the best month for the Dow and the S&P in just over four years.
Of the 101 companies in the Standard & Poor's 500 Index that reported results last week, 70 beat consensus earnings-per-share estimates, 14 met expectations and 17 missed.
For companies reporting results in the first quarter so far, 91 have beaten estimates, or 67.4 percent, down from 70.5 percent that beat a year ago.
The upcoming crop of earnings reports includes a fairly diverse group such as brewer Anheuser-Busch Cos. Inc., Microsoft Corp. and DuPont . Also on the list are aerospace companies Lockheed Martin Corp. Northrop Grumman Corpand Boeing Co. and oil companies Exxon Mobil Corp. and ChevronCorp.
Results from S&P 500 companies so far show earnings are projected to rise 5.3 percent from the first quarter of 2006, up from 4.5 percent last week.
For the data department, Tuesday's report from the Conference Board on its index of consumer sentiment will be a highlight. The index fell to 107.2 in March from 111.2 in February; in a Reuters poll of economists, the median forecast for April points to further slippage to 105.0.
On Friday, the Reuters/University of Michigan Surveys of Consumers is due for an update. A preliminary report showed the consumer sentiment index for April slipped to 85.3 from 88.4 in March. The consensus is for a final reading of 85.2.
As the slump in housing remains a worry for investors, they will have more data to consider Tuesday and Wednesday.
The National Association of Realtors will report March existing home-sales data on Tuesday while on Wednesday investors get a look at data on new home sales. According to the consensus, new sales activity in March is expected to rise slightly from the pace in February, which was the lowest level in nearly seven years.
Also on Wednesday, the Commerce Department issues data on durable goods orders for March. The median forecast is for a 2.5 percent increase, which would be larger than February's 1.7 percent increase.
The economy will come into focus on Friday when investors get their first look at the pace of U.S. growth in the first quarter. The consensus forecast calls for a 1.8 percent annual rate, down from 2.5 percent in the fourth quarter of 2006. |
| Tarih
: 23.04.2007 |
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© 2006 Mert TOKER All Rights Reserved. |
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