Waiting for GDP
Stocks took a breather on Monday after breaking to new highs last week. My guess is that investors have their bets in and are now holding their breath awaiting the results.
Note that the consensus for Q1 is now down to a paltry +2% growth rate. This should be an easy hurdle to clear. Anything greater than +2.5% will send stocks on a ride up towards Dow 13,000. However, if we fall short of this tepid growth rate, then expect us to retest Dow 12,000.
What do I think will happen? I think that the early results from this earnings season has increased the odds that we will be north of 2%...but not by much. (2.2 to 2.4%). This will be good for stocks, yet probably only see 2% more upside in overall markets before the usual summer doldrums take over.
Here is the defensive game plan if we fall short of 2% GDP growth. First, we need to assess how bad the situation is. That will depend on how far under 2% we are and, more importantly, WHY are we that far under. This will tell us how defensive we need to be. Meaning how much money to take off the table? |
发表于 2011-4-25 21:04
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