http://money.cnn.com/news/newsfeeds/articles/djf500/200907250005DOWJONESDJONLINE000002_FORTUNE5.htm
MARKET SNAPSHOT: U.S. Stock Market To Begin Week From Lofty Perch
Dow Jones
July 25, 2009: 12:05 AM ET
Coming off its best two-week stint in years, the U.S. stock market will start off the week ahead at its best levels this year. Whether the climb continues likely depends on earnings, economic data and Treasury auctions.
"It seems entirely appropriate on the 40th anniversary of the landing on the moon that we chose to put on our space suits and go to the moon," said Art Hogan, chief market strategist, Jefferies & Co., of last week's trades.
Capping a week that had the Dow Jones Industrial Average (DJI) back above 9, 000 for the first time since early January, the blue-chip index on Friday added another 23.95 points, or 0.3%, to end at 9,093.24, leaving it 4% higher on the week and at its highest settlement since Nov. 5, 2008.
The S&P 500 Index (SPX) rose 2.97 points, or 0.3%, to 979.26, gaining 4.1% from the week-earlier finish. The Nasdaq Composite Index (RIXF) snapped a 12- session winning streak, falling 7.64 points, or 0.4%, to 1,965.96, with the technology-laden index up 4.2% on the week.
Of the 500 companies on the S&P, 181 issues, or 36%, have reported quarterly results, which were off 26% from the year-ago quarter, vs. consensus estimates calling for a slide of 36%.
"So far this earnings season, 71% have beat earnings estimates," commented Hogan, who contrasted the statistic to the 20-year average of 61%. "Historically we beat by an average of 2%, and so far this quarter we're beating by an average of 11%, and we're getting guidance for the first time in two quarters."
Added to the bullish mix is an "important but not-talked-about fact that the commodity markets have calmed down," said Hogan, noting that the price of a barrel of oil had dived from $72 to $58 in the two weeks preceding the start of earnings.
Oil prices gained 7.1% for the week, with crude closing at $68.05 a barrel on the New York Mercantile Exchange. .
The economic calendar picks up in coming days, with one market watcher, Peter Cecchini, a partner at Seven Bridges Management, pointing to Tuesday's consumer- confidence index and Wednesday's durable-goods report as especially important in what he calls "a very sentiment-driven market."
"This Christmas-in-July market environment won't last forever and could evaporate as quickly as it developed when the earnings-reporting season begins to wind down," said Fred Dickson, chief market strategist at Davidson Companies.
Three Dow components -- Verizon Communications Inc. (VZ), Exxon Mobil Corp. ( XOM) and Walt Disney Co. (DIS) -- will be among the companies reporting results for the second quarter.
Off the Dow, Honeywell International Inc. (HON), Rockwell Automation (ROK) and Travelers Companies Inc. (TRV) are among those reporting of particular interest, according to Cecchini.
Treasury sale
Stock investors will likely keep close tabs as the U.S. Treasury auctions off nearly a quarter of a trillion dollars in U.S. debt.
"I am not hoping the auctions go poorly, but people worry whether or not these things will be fully subscribed," said Cecchini.
"We could have another constructive week," said Hogan of the coming sessions.
Others were less sunny in their views. Karl Mills, president and chief investment officer for Jurika Mills & Keifer, said the market's fixation remains earnings, but he questions whether the market has gone too far, too fast, sprinting from being overly pessimistic to overly hopeful.
"I really cannot tell you what is going to happen next week, but when sentiment gets this bullish, and people are very complacent -- as evidenced by the VIX (VIX) [the Chicago Options Exchange Volatility Index], there is bound to be a pullback, and it feels like it's going to be sooner rather than later," added Cecchini.
MARKET SNAPSHOT: U.S. Stock Market To Begin Week From Lofty Perch
Dow Jones
July 25, 2009: 12:05 AM ET
Coming off its best two-week stint in years, the U.S. stock market will start off the week ahead at its best levels this year. Whether the climb continues likely depends on earnings, economic data and Treasury auctions.
"It seems entirely appropriate on the 40th anniversary of the landing on the moon that we chose to put on our space suits and go to the moon," said Art Hogan, chief market strategist, Jefferies & Co., of last week's trades.
Capping a week that had the Dow Jones Industrial Average (DJI) back above 9, 000 for the first time since early January, the blue-chip index on Friday added another 23.95 points, or 0.3%, to end at 9,093.24, leaving it 4% higher on the week and at its highest settlement since Nov. 5, 2008.
The S&P 500 Index (SPX) rose 2.97 points, or 0.3%, to 979.26, gaining 4.1% from the week-earlier finish. The Nasdaq Composite Index (RIXF) snapped a 12- session winning streak, falling 7.64 points, or 0.4%, to 1,965.96, with the technology-laden index up 4.2% on the week.
Of the 500 companies on the S&P, 181 issues, or 36%, have reported quarterly results, which were off 26% from the year-ago quarter, vs. consensus estimates calling for a slide of 36%.
"So far this earnings season, 71% have beat earnings estimates," commented Hogan, who contrasted the statistic to the 20-year average of 61%. "Historically we beat by an average of 2%, and so far this quarter we're beating by an average of 11%, and we're getting guidance for the first time in two quarters."
Added to the bullish mix is an "important but not-talked-about fact that the commodity markets have calmed down," said Hogan, noting that the price of a barrel of oil had dived from $72 to $58 in the two weeks preceding the start of earnings.
Oil prices gained 7.1% for the week, with crude closing at $68.05 a barrel on the New York Mercantile Exchange. .
The economic calendar picks up in coming days, with one market watcher, Peter Cecchini, a partner at Seven Bridges Management, pointing to Tuesday's consumer- confidence index and Wednesday's durable-goods report as especially important in what he calls "a very sentiment-driven market."
"This Christmas-in-July market environment won't last forever and could evaporate as quickly as it developed when the earnings-reporting season begins to wind down," said Fred Dickson, chief market strategist at Davidson Companies.
Three Dow components -- Verizon Communications Inc. (VZ), Exxon Mobil Corp. ( XOM) and Walt Disney Co. (DIS) -- will be among the companies reporting results for the second quarter.
Off the Dow, Honeywell International Inc. (HON), Rockwell Automation (ROK) and Travelers Companies Inc. (TRV) are among those reporting of particular interest, according to Cecchini.
Treasury sale
Stock investors will likely keep close tabs as the U.S. Treasury auctions off nearly a quarter of a trillion dollars in U.S. debt.
"I am not hoping the auctions go poorly, but people worry whether or not these things will be fully subscribed," said Cecchini.
"We could have another constructive week," said Hogan of the coming sessions.
Others were less sunny in their views. Karl Mills, president and chief investment officer for Jurika Mills & Keifer, said the market's fixation remains earnings, but he questions whether the market has gone too far, too fast, sprinting from being overly pessimistic to overly hopeful.
"I really cannot tell you what is going to happen next week, but when sentiment gets this bullish, and people are very complacent -- as evidenced by the VIX (VIX) [the Chicago Options Exchange Volatility Index], there is bound to be a pullback, and it feels like it's going to be sooner rather than later," added Cecchini.
