Remember The Bull Position
Stock action in the last week of the month supports bull position.
Remember the bull position: that the great decline in stock prices, combined with government support, along with economic news that will prove to be "less bad" as the months go on, is providing a floor under the stock market.
The basic tenet is that the lows of the market were likely seen on March 9th.
Bears, of course, consider this balderdash.
But consider what is happening today:
1) "Swine flu" trades reverse, so airlines, cruise lines and hotels are up, drug stores are down.
2) Banks mixed despite stress test concerns
--home prices decline, but at less rapid rate
--consumer confidence: hit its highest level since last November, although it remains low by historic standards.
4) On earnings, disappointing commentary from US Steel is offset by beats from Pfizer, Rockwell Collins, Office Depot and Coventry.
More importantly, recall that earnings last quarter saw many companies, particularly financials, missing by a wide margin, but this quarter most companies are beating estimates by wider margins, again led by financials.