The Wall Street Digest Hotline Update for October 4, 2005
Concerns over third-quarter earnings helped to push stock prices lower today. At the close, the Dow dropped 94 points, closing at 10,441; the Nasdaq fell 16 points, to close at 2,139; and oil closed down $0.10 at $63.80 per barrel.
Volatile oil prices is another problem for the stock market. Fear that Greenspan will go too far with his Fed funds interest rate increases is the other problem. After reviewing all of the key, forward-looking charts, Donald Rowe does not expect a resolution of these two problems until the end of October.
Also, keep in mind that hurricane season does not end until November 30th. Unfortunately, there is still time for another Category Five disaster in the Gulf of Mexico. Hurricanes Katrina and Rita have destroyed 109 oil platforms and five drilling rigs in the Gulf of Mexico.
When you are waiting for a great bull market to lift-off, it is the sitting and waiting that is the most difficult. Keep in mind that this bull market will not lift-off until technology and the small-cap stocks on the Nasdaq are the clear market leaders. The energy sector is still leading the market and has the bull market nailed to the floor. Patience will be rewarded in November.
Stay patient for now and close to Rowe’s Hotline Updates as he continues to adjust the portfolio of stocks and mutual funds to take advantage of the great move-up that will eventually unfold.
This article highlights the commentary of Donald H. Rowe for the Zacks.com audience. Donald H. Rowe provides insightful analysis, market commentary, and favorite recommendations on a timely basis in "The Wall Street Digest" newsletter. Try it free for 30 days and see if you can improve your investment performance. Learn more about "The Wall Street Digest" and 30-Day Free Trial. And get immediate access to current issues and special reports. Click here now.
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