The stock market continues to struggle to break out of a trading range. The range seems to be between 1040 and 1150 on the S&P 500 Index. Leading into last week, the market appeared to be underwhelmed by the tail end of earnings season. Despite record levels of better than expected earnings reports, the market failed to move up.
Then last week a slew of negative economic reposts were released and the market failed to significantly decline. In the face of this bad news, the stock markets held up remarkably well. If the market can break through the 1115 level, perhaps it can test its high point of 1150.
Of the reports released last week, most were negative but five of 16 reports were positive. Housing statistics continue to disappoint and consumer confidence continues to decline. Reports seem to indicate that the recovery is going rather slowly.
The economy appears to be recovering, even though rather slowly. We believe and hope that 2010 will ultimately prove to be a good year for stocks. Only time will tell, but for the time being the extreme volatility of 2008 and early 2009 seem to have subsided. Despite what appears to be mostly bad news, we believe that investors should remain fully invested.
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PAST PERFORMANCE IS NOT A GUARANTEE OF FUTURE RESULTS. Investing in stocks, bonds, mutual funds and other investments involves risk, and may decline in value and are not insured by the FDIC or any other Federal government agency.