Overheard On The Street

Here’s what they’re saying at mid-day:

Robin Griffiths, Global Technical
Strategist, HSBC: “Over the last 100 years, the performance of the Dow
during the strongest presidential season (July 31 to October 31) has proven to
be quite a predictor for the outcome of the U.S. presidential elections. If the
market falls through to October 31, then the challenger wins. If the market
rises during that period, then the incumbent party wins. This Dow Elections Theory has
an 84% accuracy rate (21 out of 25 elections).

“From July 31st, the Dow Jones was at 10,500, fell to a low of 9,975,
and then rallied to 10,890 on October 31st. But, looking at the various 3-month
charts from the presidential election years when the Dow Jones began to fall in late
July to a low in October and then rallied, in these cases, the challenger
won.”

Robert Dickey, Managing Director of
Technical Research, Dain Rauscher: “The market seems to be getting less
sensitive to otherwise unsettling news, as stocks are bouncing back after dips
much more quickly than they did a month or two ago. When the market starts to
turn a deaf ear to news that could be taken as a negative catalyst, it’s a sign
that the buying pressure is building.

“The Nasdaq has been choppy, but constructive during the past two weeks, and a
move over 3500 would see the trend accelerate to the upside. Since 3500 has been
both an important top and bottom area recently, it may take more time to get
through but it is working toward that eventually.”

Brian Belski, Fundamental Market Analyst,
U.S. Bancorp/Piper Jaffray: “With mutual fund inflows slowing last week,
investors appear to be taking a wait-and-see stance on the stock market. Yet,
the dominant inflows into Small-Cap and Aggressive Growth Funds last week
suggest to us that investor disciplines are shifting to more of a longer term
perspective, a trend that should provide continued support for growth vehicles
going forward.”

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