(As of 7:14 am PST)
Stocks are slightly
lower this morning but continue to trade at record highs amid several earnings
reports. Some big names reported Q2 earnings this morning including Goldman
Sachs, whose second quarter net income doubled, far exceeding expectations.
Johnson & Johnson beat on revenues, and lifted its full-year earnings
guidance while Coca Cola reported declining revenues for Q2. On the data front,
industrial production rose 0.3% in June, stronger than expected. Consumer
prices also rose in June, led by housing, food, and gasoline prices. Core CPI
(which is used by the Federal Reserve to measure inflation) advanced 0.2% in
June. Finally, a report on the housing sector showed homebuilder confidence in
July rising to the highest level in more than 7 years. Stocks recovered early
losses after the housing report was released. In international news, Asian
markets finished mostly higher following Wall St. gains from Monday. Europe is
down after a report out of Germany showed economic sentiment declining. Gold
prices are inching back, up another 0.5% to $1290/oz. while interest rates are
slightly lower. At these market tops, investors seem cautiously optimistic,
taking a “buy on the dips, sell on the rips” approach as earnings and Fed
policy dictate market direction.
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