The Dow is having its third straight day of gains. Dow is up 134, advancers over decliners 2-1 and NAZ rose 18. All on VERY light volume, there is no oomph behind this rally. Much of today's news was favorable, bringing out buyers.
•U.S. Economy Grew Faster Than Estimated in Second Quarter on Export Gains
The GDP growth for Q2 was revised upward to 3.3%, better than expected, following 2 weak quarters. Good news, except it signals there is no recession & no need for further rate cuts by the FED.
•Fannie's Mudd Shakes Up Management to Bolster Confidence After Stock Falls
Fannie Mae (FNM) shakes up management sending the stock higher. To me it looks like rearranging the chairs on the Titanic. Whopper size problems remain with the mortgage portfolio. It's up from 4½ to 7 in less than a week as markets are taking recent news very well.
Oil rose 2 to 120 on worries about the Gutav storm which is scheduled to reach the US early next week. The biggest unknown is damage it could do in the gulf where is a lot of oil equipment. Last night on CNBC Asia, there was a lot of talk about Gustav & they gave a weather update as this storm gets worldwide attention. The Alerian MLP Index is flat at 272 today after a 6 point rally from the low 3 days ago.
More news, but it's mixed. Caterpillar is one of may favorites as they are doing very well in developing countries (i.e. China), but their US business is struggling in what they call "recessionary conditions." US retail business remain tough, but the sector is up nicely today. Tiffany (TIF) & Zales (ZLC) are each up a good 10% today while Sears (SHLD) is up 1% on a very dreary report. Toyota (TM) lowered its 2009 sales growth target by 7%, sending the stock higher. Even, General Motors (GM), a Dow stock, inched up. Tough to take today's optimism in the stock market seriously.
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