Market Week Outlook: Focus On Earnings
StockTradingToGo | Jul 23, 2013 07:09AM ET
After the sharp advance the first few weeks of this rally, we've turned to a slow grind up in the past week and a half. Markets shrugged off an earnings disappointment from McDonald's (MCD) yesterday, to inch up 0.2% for the S&P 500 and 0.36% for the NASDAQ. Economic data was light with existing home sales the main figure:
Existing home sales in June slipped 1.2 percent in June to an annual rate of 5.08 million, according to the National Association of Realtors, missing expectations for a reading of 5.25 million units. Still, the reading was still the second-highest level of sales since November 2009.
The focus this week will be on earning reports with the Fed finally sidelined for a week and economic data very light. Many of the big wig names like Apple (AAPL), Caterpillar (CAT), Amazon (AMZN), Facebook (FB), etc will hit this week.
The S&P 500 broke out of that bull flag last week and unlike the NASDAQ has been able to hold it.
It's been more choppy up here for the NASDAQ due to the tech wreck late last week.
The volatility index continues to suffer as people believe in the "Bernanke Put" again (he has our back, what can go wrong?)
Of course individual stories can always go wrong as we saw yesterday with Dow component McDonald's. There was some damage but we can see why the stock bottomed were it did yesterday - a very clear trendline. However if that breaks, there could be some significant downside.
The world's biggest hamburger chain reported a second-quarter profit that rose 4 percent but fell short of Wall Street expectations. It also said July sales are expected to be relatively flat and warned of a tough year ahead, given the heightened competition and rough economic conditions around the world. The company, which has more than 34,000 locations worldwide, says global sales edged up 1 percent at restaurants open at least a year. The company said sales were down 0.1 percent in Europe.
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