Consumer Spending Can Make this Rally Last
A rebound in Consumer Spending, if this keeps up, stocks can continue to climb. Consumer spending in the Q1 09 increased 2.2% after dropping at a 4% annual pace in the previous two quarters.
U.S. spending added 1.5% percentage points to gross domestic product, which fell at a 6.1% annualized rate in the first quarter, nearly matching the 6.3% drop in the fourth quarter.
In short, the rally will continue because inventories need to be restocked. Until we see utilization rates drop, the market will go higher, or sustain current levels.
I repeat: we will not trade lower, unless factory utilization rates head lower from here.
Get ready for fun in the retail stocks, they are all up big today, take your pick
|Name||Exchange||Symbol||Last Trade||Change||Mkt Cap|
|Retail Ventures, Inc.||NYSE||RVI||2.47||120.24M|
|J.C. Penney Company, Inc.||NYSE||JCP||28.67||6.37B|
|Sears Holdings Corporation||NASDAQ||SHLD||61.20||7.46B|
|Stage Stores, Inc.||NYSE||SSI||12.43||471.41M|
|Wal-Mart Stores, Inc.||NYSE||WMT||50.10||196.03B|