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What January Tells Us About 2013
The sting from the negative GDP read on Wednesday continues to hamper the rally. In fact, Thursday's close has us just a smidge under 1500.
Today's slate of economic reports holds the key for where stocks are headed next. The lineup includes some heavyweights like Government Employment Situation, PMI Mfg, Consumer Sentiment, Construction Spending and ISM Mfg. (Key reports in bold).
Beyond this short term conundrum we have a fairly good read on the long term outlook for 2013. That being the concept "As January goes, so goes the rest of the year". Amazingly 36 out of the last 39 times that January has been profitable for stocks, the year ended in positive territory too. That is a hard track record to beat. And gladly, this January was up +5%.
That fits in with my thesis that the market will stay on the uptrend until a recession is on the horizon or stocks become overvalued. Neither is of serious concern at this time and that is why I think this will be another profitable year for stock investors.
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Best,

Steve Reitmeister
Executive VP - Zacks.com
Zacks Investment Research
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Bull & Bear of the Day
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Zacks Rank #1 Strong Buy
WisdomTree Investments (WETF)
This investment company could do well thanks to a strong earnings picture and impressive growth in the ETF space. |
Zacks Rank #5 Strong Sell
Joseph A. Bank Clothiers (JOSB)
This retail firm is famous for its deals, but now its stock is on sale thanks to a gloomy outlook and weak earnings.
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