The Nvest Market Blog, our current thoughts on the Street
- Categories
- Asset Class Review
- Market Alert
- Market Outlook
- Market Valuation
- Mutual Funds
- Planning Considerations
- Archives
- September 2010 (1)
- August 2010 (4)
- July 2010 (5)
- June 2010 (5)
- May 2010 (6)
- April 2010 (5)
- March 2010 (6)
- February 2010 (4)
- January 2010 (4)
- December 2009 (4)
- November 2009 (5)
- October 2009 (5)
- September 2009 (4)
- August 2009 (5)
- July 2009 (3)
- June 2009 (5)
- May 2009 (4)
- April 2009 (4)
- March 2009 (6)
- February 2009 (4)
- January 2009 (4)
- December 2008 (6)
- November 2008 (4)
- October 2008 (5)
- September 2008 (9)
- August 2008 (3)
- July 2008 (5)
- June 2008 (4)
- May 2008 (3)
- April 2008 (1)
- March 2008 (2)
- February 2008 (1)
- January 2008 (1)
- December 2007 (0)
- November 2007 (1)
- October 2007 (1)
- September 2007 (0)
- August 2007 (0)
- July 2007 (0)
- June 2007 (0)
- Contributors
- Bill Henderly, CFA
- Steve Henderly, CFA
Markets Fully Recover From Prior Week Damage - Week Ended 7/9/10
posted 07.12.2010 at 09:51 a.m. by steve
What a difference a week makes! Friday the 2nd felt like the world (financial) was coming to an end after five consecutive days of stock market declines. Seven days and four positive trading sessions later, things felt much better. Last week, the stock market roared ahead, recapturing much of what was lost in the week prior. Some mutual funds gained more than 7%! Overall, the S&P 500 gained +5.4% making the last two weeks of down and up of virtually no consequence. It truly has been a bumpy journey since late April, with the stock market having forfeited what would have been attractive gains for a years time and sliding into negative territory for the year-to-date. Still, last week was nothing short of encouraging as the news cycle turned more favorable after weeks of disappointment.
Most notably last week, although still not signaling strength, was that the latest unemployment-related data posted marginal improvement. Additionally, there was attempt made by the Obama administration to repair recent strife with the business community, talk of middle-east peace, Google/China mending fences, better than expected numbers from financial firms, progress being made on the capping of the Gulf of Mexico oil spill, better weekly retail sales and several other items. However, while there were signs of improvement on many fronts, not all news was good. Not entirely unexpected was that consumer confidence fell and mortgage applications for home purchase also declined. In the face of so much conflicted news (one report good, another bad), it appears as though the most probable scenario for the economy, and stock market for that matter is bumpy (volatile), slow, positive growth; not a double-dip.
This week, 2Q earnings season begins. Investors are likely to be focused on results as it was early (May) in the 2Q period that the stock market began having its fits and the data/news cycle turned for the worse. Not only will the bottom and top line earnings numbers be critical, but also watched closely will be the executive outlooks for business in the back half of this year. Will their tune remain optimistic, or will the recent struggles and uncertainty send them into a more defensive demeanor?