Sunday, July 11, 2010

Itz Weekend Review

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This past holiday-shortened week provided the markets a much needed oversold rally, with most of the major indexes up 5%+. With the Bank Index up 9.83%, Oil Index up 7.6% and the CRB index up nearly 7%!
Monday gets things rolling as the Q2 earnings cycle begins. Alcoa officially kicks off the cycle when they reports, but the focus will be on INTC, GOOG, JPM, BAC, C and GE.  GE and Intel  will be the biggest tells on the state of the economy. JPM, C and BAC will tell us about the health of the banking sector.   There were 287k calls traded on the XLF on Friday. That was three times the four-week average and twice the number of puts traded.
Earnings estimates are trending lower, but still growing. Earnings for S&P companies are expected to have risen +34% in Q2 compared to 52% in Q1, estimates for Q3 are for a +25% gain. So for the next few weeks investors will be focusing on earnings...but the real number that matters is the monthly Jobs Report.

 Is this a double-dip recovery? Insight with Don Luskin, Trend Macro and Michael Pento, Delta Global Advisors. [Link to Remarks by Ben Bernanke]

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