Richard Tafoya
Apr 20th, 2007, 06:01 PM
Marketwatch:
http://www.marketwatch.com/news/story/market-snapshot-us-stock-rally/story.aspx?guid=%7B0192BA93-978D-47A5-95B7-435806159450%7D
The three-week rally in stocks that propelled the Dow Jones Industrial Average to record highs is expected to come under pressure in the coming week as the busiest stage of earnings season gets under way, strategists said.
Analysts said that surprisingly robust earnings from some of the biggest blue-chip companies in the last several sessions pulled the Dow average to within striking distance of 13,000, but masked what is still generally expected to be the weakest earnings season in more then three years. Other factors that could weigh on stocks include a gross domestic product report expected to show weakness and a drop in consumer confidence.
"We're going to start working down," said William LaFleur, chief portfolio strategist at Barclay Partners Asset Management. "I think we've seen the euphoria already. Individual stocks as they report will do well...but there's no breadth to the market."
Paul Nolte, director of investments at Hinsdale Associates, said though stock averages are higher, the number of declining stocks has outnumbered advancers throughout the week.
"There's weakness below the surface...and that likely caps future gains," he said. "We may make a run at 13,000 on the Dow and that may provide a little bit of resistance to the market."
Analysts set their expectations for first-quarter earnings fairly low, which has helped many companies beat forecasts. Nevertheless, the first big batch of results has pulled the first-quarter growth rate to 5.2% from 3.3% last week.
http://www.marketwatch.com/news/story/market-snapshot-us-stock-rally/story.aspx?guid=%7B0192BA93-978D-47A5-95B7-435806159450%7D
The three-week rally in stocks that propelled the Dow Jones Industrial Average to record highs is expected to come under pressure in the coming week as the busiest stage of earnings season gets under way, strategists said.
Analysts said that surprisingly robust earnings from some of the biggest blue-chip companies in the last several sessions pulled the Dow average to within striking distance of 13,000, but masked what is still generally expected to be the weakest earnings season in more then three years. Other factors that could weigh on stocks include a gross domestic product report expected to show weakness and a drop in consumer confidence.
"We're going to start working down," said William LaFleur, chief portfolio strategist at Barclay Partners Asset Management. "I think we've seen the euphoria already. Individual stocks as they report will do well...but there's no breadth to the market."
Paul Nolte, director of investments at Hinsdale Associates, said though stock averages are higher, the number of declining stocks has outnumbered advancers throughout the week.
"There's weakness below the surface...and that likely caps future gains," he said. "We may make a run at 13,000 on the Dow and that may provide a little bit of resistance to the market."
Analysts set their expectations for first-quarter earnings fairly low, which has helped many companies beat forecasts. Nevertheless, the first big batch of results has pulled the first-quarter growth rate to 5.2% from 3.3% last week.