Marc Pado Comments: Wall Street Eyes New Catalyst - West Australian Business News
West Australian Business News, October 26, 2009
The earnings-driven rally of the past few weeks appears to have run out of steam on Wall Street, leaving the market in search of a new catalyst heading into the final stretch of 2009. The main stock indexes remain near 12-month highs, but gains have been harder to achieve following the sizzling move since March of some 60 per cent for the broad market.
Wall Street has been pleasantly surprised by the strength of third-quarter corporate earnings. Analysts, though, say their ability to spark fresh gains appears to be diminished. The Dow Jones Industrial Average lost 0.24 per cent for the week to end at 9,972.18, as it hovered around the 10,000 level topped a week earlier. The Standard & Poor's 500 broad-market index shed 0.74 per cent to 1,079.60 and the technology-rich Nasdaq composite drifted down 0.11 per cent on the week to 2,154.47. During the past week, the market warmed to earnings from Apple, Microsoft and Yahoo! in the tech sector, as well as Morgan Stanley and Wells Fargo in banking, but they only gave a temporary boost to stocks.
"The earnings have been tremendous, not just beating estimates but blowing away estimates. That's been the catalyst for holding the market together," said Marc Pado at Cantor Fitzgerald. But he said that because many had already anticipated a strong season, "we see selling on the news".
