Wed, May 14 2008, 10:35 GMT
by Carley Garner
**Be sure to see my monthly column “Futures for You” in Stocks and Commodities!!!
Investors continue to be sensitive in regards to inflation but the major indices managed to maintain composure. Bernanke delivered a speech at a Fed conference in Atlanta. According to the Fed Chair, turmoil in the financial markets has been eased “somewhat”, although he added that the situation is still “far from normal”.
Despite his comments being overall positive, there are many dissenting opinions as to the health of the economy and claim that the statements weren’t enough to improve equity market conditions. Brian Gendreau, investment strategist for ING investment Management, claims that investors won’t get a clear picture until more economic data is released in the upcoming months. Gendreau stated, “We’re going to go through a period where the markets are going to focus on the macro-data, and any adverse piece of news about the credit markets.” He added, “It will be a trendless market until the uncertainties about a contraction in economic activity are resolved.”
On a bright note, last month’s retail sales data beat expectations. Given that consumer spending is the lifeline of the economy; this is a glimpse of hope. Additionally, Wal-Mart Stores Inc. warned that second quarter earnings may be below original forecasts. While this is bad news for the retail giant, it may actually be slightly positive in terms of measuring the health of the economy. Discount retailers such as Wal-Mart typically thrive in poor economic environments. If consumers haven’t felt the need to “downsize” their shopping to discount, maybe they aren’t hurting as badly as many may think. I am not putting down the idea of shopping at Wal-Mart. It is my store of choice and would likely be even if I hit the lottery. Why pay more? (No they did not pay me for this plug).
Please note: A mini-sized Dow chart is used because it is better for charting purposes, but trade recommendations are based the full sized Dow unless otherwise noted.
**There is unlimited risk in naked option selling and futures trading
Position Trade – Flat
Please note: A mini-Nasdaq chart is used because it is better for charting purposes, trade recommendations will denote whether a mini or full sized contract should be used.
**There is unlimited risk in naked option selling and futures trading
Position Trade – Flat
Published on Wed, May 14 2008, 10:40 GMT
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