A Review of the Last Several Weeks Shows that We May Have Seen the Bottom
Apr 8, 2009
Posted by Jody Eisenman | Filed under Uncategorized
The stock market has now rallied off of its lows during that last month. From a low on the DOW at 6440, we are now up over 20% to about 7800. The NASDAQ year to date has traded even better, and is only off fractionally for the year. I believe that we have seen the lows for awhile based on the following:
- The market, which seemed to go into a selling frenzy on any bad news, now seems to shrug it off. Corporate earnings this quarter are expected to be weak but stocks continue to climb.
- Earlier this week, both George Soros and Nouriel Roubini reiterated their bearish stance, and the market held.
- The financial stocks which led the market down now seemed to have stabilized and are trading better than the broad market even on weak days. Even Meredith Whitney is sounding like the banks may be stabilizing here.
- The government is finally taking steps to regulate the multi-trillion dollar credit default swap market. This should go a long way to restoring confidence.
To be sure, we are not out of the woods yet. Unemployment continues to rise, and corporate bankruptcies are increasing as well. However, I believe that better days are ahead.
