Friday, July 1, 2011

All News is Good News as Market Surges on ISM Manufacturing Reading of 55.3. Bad Construction Spending Figure and Consumer Sentiment Ignored

We just had 3 reports released but all eyes seem to be on ISM Manufacturing which came in at 55.3 versus an expectation of 52ish.  (May's reading was 53.5)  For some reason it is not yet on the ISM website so I can't bring over the table.  New orders and employment ticked up slightly.  Prices paid plunged from 76.0 to 68.5 - a good thing.  (lowest since August 2010)

The S&P 500 has jumped a quick 0.7% in response.

 Construction spending dropped 0.6% vs 0.1% drop expected (ignored)

The University of Michigan consumer sentiment figure dropped from 74.3 to 71.5. (ignored)

I think it would be safe to say the market is short term overbought as it nearly reaches a mind blowing weekly gain of 5% on the S&P 500.


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