In This Issue
Rally takes a breather?
Leaders bounce back again...
Earnings forecasts show signs of hope
Existing and new home sales fall
Waiting for Case-Shiller
Treasury demand surges as spending soars
Quote of the week
'Tax receipts are just collapsing. [The need to sell more debt] is a big issue in the Treasury market and it is ongoing. The surging budget deficit is the primary cause.' Head Stamford UBS Securities interest-rate strategist Chris Ahrens.
Rally takes a break?
It has now been seven weeks since this rally began and this week stocks took a break. Since hitting its low in the first week of March, the S&P500 is up nearly 28%. Last week we mentioned that the S&P500 index was 9.6% above its 50-DMA and that is about where it stayed this week (9.5%) so stocks remain overbought. But indexes are also still banging up against key resistance areas that taken together with how overbought stocks are across the board, increases the chances for a correction. And now this rally is losing momentum. If prices hold up it will show that investor demand and interest in stocks is increasing despite the technicals pointing to a drop. But that must be considered a long shot....