Stocks Quiet As Next European Domino Wobbles
Tuesday, July 5, 2011
Stock Market Commentary:
Stocks were closed on Monday in observance of the July 4th holiday. Overseas, stock markets edged higher as investors awaited Friday’s much anticipated jobs report. Stocks were quiet on Tuesday after the next European domino began to wobble. However, it is encouraging to see that all the major averages remain above their respective 50 DMA lines which suggests the bulls remain in control of this market. The next level of resistance is their respective 2011 highs.
Monday & Tuesday: Stocks Quiet As Investors Await Latest Employment Data
Stocks were quiet on Tuesday after the Commerce Department said U.S. factory goods rose +0.8% in May to $445.29 billion. The gain followed a large decline in April and bodes well for the ongoing economic recovery. The report also reiterated a series of stronger than expected economic data which suggests the economy is improving. Investors are now waiting for ADP’s number and then Friday’s official non-farm payrolls report for the latest measure from the already weak U.S. jobs market. Elsewhere, Moody’s Investors Service, a popular rating agency, downgraded Portugal’s debt to junk status which sparked fresh concerns regarding the European debt crisis.
Market Outlook- Market In A Confirmed Uptrend:
The last week of June’s strong action suggests the market is back in a confirmed rally. As our longstanding clients/readers know, we like to filter out the noise and focus on what matters most: market action. That said, the action remains bullish until the major averages and leading stocks violate their respective 50 DMA lines. Until then, the market deserves the bullish benefit of the doubt. Barring some unforeseen event, investors will likely be focusing on the jobs market this week and then turn their attention to Q2 earnings. If you are looking for specific help navigating this market, please contact us for more information.
