Overheard On The Street
Here’s what they’re saying at mid-day
Paul
Rabbitt, President, RabbittAnalytics.com: ‘The bright spot in this
market, of course, is the renewed enthusiasm the Fed has expressed toward
stimulating the economy. Last
week’s economic data did little to derail their recent easing stance.
It included declines in the Leading Indicators (worst since 1996 and the
third monthly decline in a row implying recession), the Fourth Quarter
Employment Cost Index (ECI) (down for the third consecutive quarter, and Durable
Goods orders (ex-volatile aircraft orders).
“Greenspan
told the Senate Budget Committee he believes U.S. growth to be near zero and
that he now believes the government has room to both cut taxes and continue
paying down the federal debt. Federal
funds futures have signaled 90% odds the Fed will cut rates by ½ percentage
Wednesday. Moreover, a survey of
all 25 primary bond dealers revealed they also expect the Fed to cut by a ½
percentage.”
Frank Gretz, Market Analyst, Shields and
Co.: “There
have been many positive aspects to the market action lately, including the lack
of any real downside.Â
Astounding, or is this too part of the January effect?Â
Another positive aspect to the recent action is the ability of stocks to
ignore bad news. In making its
announcement, Lucent also reported lower than expected earnings.Â
Intel and most of the Semiconductors have missed estimates and/or
‘warned,’ and the stocks did not react negatively.Â
When bad news isn’t bad, it suggests stocks are sold out — the stocks
didn’t go down because all the selling was out of the way.“
Brian Belski, Fundamental Market
Strategist: “Some consider the trading action for the first day of January
as a foreshadower of the entire year’s results, others include performance for
the entire month of January, while others include a mix of both. We are in the
camp of using performance for the entire month of January as at least one
variable to gauge the market’s trend and psychology. This is not just because it
favors our current bullish strategy, but because we believe the actual
performance of the market so far in January has helped define sentiment that
will likely carry forward for the next several months.”