We’re positive, but for how long?
by Peter Switzer
Investors are playing a waiting game but the positive omen is that there’s no real commitment to test out the rally. The bottom line is that profit-takers are too nervous to take their money off the table and that’s for those who want to see stocks head higher.
Where we go from here will depend on Europe and if something good does not show up soon, the smarties will test out the market’s optimism.
The Dow ended up 7.04 points to finish at 13,175.64 while the S&P 500 was virtually flat at 1402.22.
The VIX or fear index is at 15 and that’s another good sign.
On the other hand Spanish bonds are sneaking up and it’s an indication that the European Central Bank has to come up with an action that will bring those rates down and send stocks up.
The importance of Europe in the global stocks story was underlined by McDonalds, which reported flat same store sales but the lower than expected result came out of its European operations.
Today we get unemployment data, which could easily be worsening but the big watch will be on China’s industrial output. This could help or hinder optimism as we wait for the Europeans to come up with a big play.
Important information:This content has been prepared without taking account of the objectives, financial situation or needs of any particular individual. It does not constitute formal advice. For this reason, any individual should, before acting, consider the appropriateness of the information, having regard to the individual’s objectives, financial situation and needs and, if necessary, seek appropriate professional advice.
Published on: Thursday, August 09, 2012
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