..a sleeper
Tuesday, April 27, 2010 at 07:01AM A sleeper of a day!. Two sides to the market, the morning consisted of more great earnings from WHR/CAT for some strength and the afternoon dip was sell the financials before GS’s hearing on Tuesday and the financial reform bill on the floor. In between was a flattish sleeper of a day. Unless, we get some excellent earnings in morning, the afternoon dip could continue into the morning trade.
The two sides, you can call the headwind or the tailwind team. The earnings tailwind coming into Monday‘s trade~40% of sp500 companies reported, ~80% have exceeded Street earnings forecasts, the average margin of upside was 20%; companies are also stopping revenue forecasts – 69% of firms are also beating St sales ests. The tailwinds…GS/financial reform. Which side would you rather play and be on…earnings …a stronger than expected recovery that is appearing or the tailwinds that don’t last very long at this point??. Mid term..earnings, but in the very short term the above smells may continue to linger.
Once the bigger names (SP) finish off this March end reporting season, we will start to get more of the mid-small cap companies. Hopefully, the earnings will follow suit and we will get surprises to trade as new growth stories emerge.