Stocks Rally On More Easy Money
Monday-Wednesday’s Action: Pullback, What Pullback?
Stocks were quiet on Monday as investors digested the latest round of economic and earnings data. The big news came from China, when the country said Chinese GDP grew by 6.9%, just beating estimates for 6.8%. It was below the whisper number of 7% and was the lowest reading since Q1 2009. Crude oil and other commodities fell on the news.
Stocks fell on Tuesday after the S&P 500 came within 1 point of 2040 which has been major resistance (formerly support). Shares of IBM ($IBM) and Harley Davidson ($HOG) were two well known stocks that gapped down after reporting weak earnings. Verizon ($VZ) and Travelers ($TRV) gapped up after reporting Q3 results. So far, earnings are a mixed bag and the reaction remains mixed at best. Housing starts rose to 1.206M, beating estimates for 1.147M. Stocks opened higher but closed lower on Wednesday after biotechs and a slew of health care stocks dragged markets lower. Valeant Pharmaceuticals (VRX) was the standout loser after shares plunged 30% on rumors of an Enron-style accounting fraud.