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Weekly Stats

April 25, 2011 – 5:00 pm

We will have another week of important earnings this week as Coca-Cola, 3M, Pepsi, Boeing and Proctor and Gamble report. These are large Blue Chip companies that will give us a sense of not just the past quarter earnings but their feelings on the future.

Also, this week the initial read on the first quarter GDP will come out and the experts expect a 1.8% increase. That is a far cry from the 3% they thought the first quarter was going to produce at the beginning of the quarter. If you remember the last quarter of 2010 was 3.1% growth.

Finally, as reported this morning March’s new homes sales were a little stronger than expected at 300,000 an increase of 11.1%. That was after February’s dismal 250,000 new home sales which was the lowest ever since they have been keeping track of these numbers in the 1960’s.

What do all these stats mean? The economy is still improving but slowly. Most experts expect a pick up in growth as the year progresses but as we have seen they are often wrong. Still once a ship the size of the U.S. economy moves in a particular direction it stays in that direction. Something spectacular has to happen to send us back into recession. That is unlikely.

The dangers are many but the worry is healthy which focuses attention on those dangers. Watch job creation. If that continues to improve it will calm a lot of stock market jitters, as increasing jobs means more consumers with cash in their pockets. Let’s hope oil comes off its recent highs because that too will mean more cash in the consumers’ pockets.

Good Trading
Steve Peasley

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