Stocks rallied strongly ahead of the FED's interest rate cut. Dow is up 258, advancers ahead of decliners 10-1 (don't see that too often!) & NAZ up 45. The markets are pricing in a 100 basis point cut, maybe even 125. The stock market rally caused selling in Treasuries sending the bond yield up 10 points to 3.42% (still a very low number). Oil is up 2 at over 107 while gold is 1006. Goldman Sachs (GS), up 13, & Lehman (LEH), up 7, rose on favorable earnings releases. Favorable means down from last year but ahead of analysts' lowered projections. OK!
The Labor Dept reported Feb inflation numbers a little higher than expected. There was a drop in home construction & new permits fell 7.8% to a 16 year low. Chances are the inflation numbers will not cause the FED to pull back on the today's rate cut. They said helping the sagging economy is their main focus. Today's strong rally may be another version of buy on the rumor & sell on the news.
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