Pros Say: 5 Good Closing Bells Will Do It
Tuesday: Rep. Barney Frank (D-Mass.) said the uptick rule will soon be reinstated but the SEC said that mark-to-market regulations would remain in place. Citigroup shares skyrocketed nearly 40 percent and many other financials rallied, lifting the market with them. General Electric* shares enjoyed an assurance from Citi; and AT&T said it'd add — yes, add — 3,000 jobs and invest up to $18 billion. CNBC heard from experts who said that investors are nearly ready to get out of cash; and gave a formula for bear-repellant.
Five Good Days Will Scare Away Bears
Joe Kinahan of Thinkorswim said it's going to take five days of higher closes to turn things around. The recent pattern of early gains, then late sell-offs, must be broken, and short sellers scared off, before the markets can make any progress. Encouraging sign: The S&P low of 660 has been repeatedly tested now.
Investors Almost Ready to Get Out of Cash
Hardesty Capital Management's David Stepherson said staying in cash is getting very tiresome; sooner or later, investors will realize that earning 1 percent will not get them to where they want to be. He is not a net buyer of stock just yet, but he is on a stock-by-stock, sector-by-sector basis. The market is very oversold, and just a little of the huge amount of cash now on the sidelines could set off a massive rally. Technology has been a good place to be.
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Health Care Sector Looks... Healthiest
Ken Kam of Marketocracy Masters 100 said stocks are set up for at least a bear-market rally; it's time to be fully invested again. The unanswered question: Is it finally time to buy, or should we be selling into the rally? Good news from more banks will help put together the sustainable rally we've been longing for. Health care is the one sector, interestingly enough, that's been acting healthy.
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Markets Seek Inspiration in Repaired Credit and Stimulus
D. A. Davidson & Co.'s Frederic Dickson is waiting for improvement in the credit markets before he's convinced that a real rally is under way. The stimulus should have a positive "trickle-in" effect next month. Jack Ablin of Harris Private Bank said he was encouraged by last Friday's session-ending short-covering rally. Since the whole world is now short, there's nothing in the way of a longer rally.
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