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Summer Doldrums or a Pause Before the Next Move

June 28, 2010 – 5:10 pm

The market is looking for something to give it optimism and finding the search difficult. The economy is still recovering but it continues to be very sluggish with many investors worrying about a double dip recession. That is not likely but the worry is real.

This morning consumption and income reports were released and they were mostly in line with expectation of slight improvement, but that didn’t help the market. The G20 meetings over the weekend did not produce any significant news therefore the market was on its own to do with the information or lack thereof as it wished, still hunting for the good news that it wants.

It feels like the market is collectively holding its breath for earnings season to start. Earnings are going to be good because we had very few earnings warnings in June. Companies tend to warn the public if they are going to miss their earnings the month before the end of the quarter and when we don’t have those warnings they generally meet or beat their earnings expectations when they start reporting. Those numbers will come in over the next four weeks or so.

Of course the jobs report this Friday for June is going to be a report that everyone is anticipating. There is an expectation of a loss of 100,000 jobs now that the census jobs are no longer being produced.

Good Trading
Steve Peasley

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