GE reported a top and bottom line beat this morning and Morgan Stanley swung to a profit and saw their year over year revenue up 23%. GE also offered positive comments on China and China itself reported a better than expected GDP reading of 7.9% on-year rise compared with expectations for 7.8%; this is the first increase in year over year growth in the Chinese economy since Q4 2010 (I still question China’s data).
While earnings season is still in its early stages, reports have been moderate to good so far on average, but are far from conclusive. Keep in mind that Q3 earnings were negative compared to 2011 and the trajectory of revenue in the S&P 500 is also flat to negative
Inflation readings seem relatively tame (if you agree with the governments CPI and PPI readings) and retail sales were slightly better than expected.
December ISM PMI readings in both manufacturing and services were both better than expectations, although still relatively weak when compared to any other “expansion” period.
UofM Consumer sentiment has been improving over the past year, but saw a huge drop in December (lowest in four months) and this morning’s reading showed further deterioration to 71.3 (expectations were for 75.1). The consumer confidence index has also been on the decline for the last three months.
All in all, I’d say that data flow is semi-positive, but far from stellar and nowhere near what it should be in a true recovery or major market rally.
Despite the mediocrity, the S&P 500 is up over 6% Since the December 31st low. Apparently the majority of investors are more confident…Are you?
Let’s get our own “Zacks Consumer Sentiment” reading
What are your real sentiments?
1. More confident; markets will continue to move higher and the economy will growth enough to justify higher stock prices and then some
2. Same confidence; stocks are fairly valued, but might have gotten ahead of themselves and will have a tough time moving much higher from here
3. Less Confident; the market’s euphoria is unjustified and the recent rally is only going to make the correction worse
4. Other; you’re feeling something completely different, explain.
If you don't have much time to type, just enter a number. I'd like to get an annecdotal reading from as many of you as possible!