Despite waking up to an ABC radio report telling me that US earnings reports this week had not been good, I found this summary on the CNBC website just after the closing bell on Wall Street:
“Stocks pulled off a gain after a wobbly session Thursday as banks rose and some better-than-expected earnings helped offset gloomy economic data.”
As Franklin D. Roosevelt once said: “All we have to fear is fear itself,” but I would add “and fear spread by the media.” As regular readers know, I expect a pullback on the stock market, but I don’t think we will go to the March lows. However, I can’t stand those who simply search for the negative for the sake of a news headline.
The real test for the market will come if there’s a bad economic number or the stress tests on the banks due in early May spook the market. Given the big 20% plus rise, some profit taking has to be expected.
I loved this from the CNBC website: “We need about two to four weeks to recharge the batteries of the market … then we’ll be ready for the next leg higher,” said Paul Schatz, president of Heritage Capital.
In economic news, existing-home sales dropped 3%, which was less than expected, and the four-week moving average for initial jobless claims rise declined slightly.
By the way, as CNBC argued — most of the earnings of the past two days came in better than expected, which helped curb stocks' losses somewhat.
I found it interesting that Johnson & Johnson fell even as it raised its dividend, which could indicate that a great, defensive stock is losing out to more cyclical stocks.
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