Stock market rallies on high hopes for economy
August 28, 2006 – 5:16 pmIf you're new here, you may want to subscribe to my RSS feed. Thanks for visiting!
Oil. Black gold. Texas Tea. That’s the stuff that people want. They can’t get enough of it, in fact, and they got slightly lower prices, which helped to rally the market. In fact, investors are bullish about a number of factors currently. And when they get bullish, they start buying. But with a market like this one, their confidence could go out the window in seconds.
“The message of this week is ‘if a tree falls in the forest, and there’s nobody there, will it make noise?’” said Larry Peruzzi, a trader with Mellon Financial’s The Boston Co. Asset management. “The market is just looking to head up, not get taken down, and sets up the table for September.”
That’s pretty much it in a nutshell. Everyone is waiting until Labor Day to get back to the real action. Today was a good day. Will it continue? You get to be the judge. And if you’re right, you’ll be laughing all the way to the bank.
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2 Responses to “Stock market rallies on high hopes for economy”
Standard & Poor’s recently reminded its readers that the “4 year cycle ” market correction is overdue. The Fed usually takes 6 months before reversing the Fed funds rate trend. The home prices bust in the States will continue to reduce economic activity. So why is the S&P 500 rebounding? According to Barron’s, the shorts seem to try to cover their positions before institutional investors are back from their vacations. Watch for third quarter earnings ( negative surprises ). On the other side, the long Treasuries are not so high as to invite a massive stock-to-bond switch. All in all, this market is risky and far from cheap.
By Claude Ferland on Sep 1, 2006
Thanks for the comment, Claude. I agree with you about the risk. I’m more comfortable in cash right now.
By Darren on Sep 1, 2006