The Day Ahead: The Market Is a Flip-Flopping Politician
A large part of me wanted to believe that earnings season would be the market's sole focus at least until around early August, the next lull in report issuances. Wave after wave of corporate commentary, income statements, balance sheets and guidance are riveting stuff to get one's hands on following months of torture in having to analyze daily headlines from obscure European Union officials. Count this guy as being unimpressed by second-quarter earnings season. Let the dyed-in-the-wool optimists wax poetic about "upside earnings" and "less bad guidance." The pure figures from companies have been full of mini snowballs that stand to metamorphose into avalanches that destroy portfolios as 2012 draws to a conclusion.
That said, the market is now acting similar to a flip-flopping politician. It's been choosing to pay outsized attention to Spanish-debt auctions, Italian prime minster musings and China-growth-slowdown risks instead of staying true to its original position -- that, in July, earnings season is god. It almost feels as if the market has developed a firm opinion on the remainder of the second-quarter reports -- better-than-expected earnings despite worse-than-expected revenues -- and is attempting to get back to deciphering the headline risk that could foster an even worse sequential showing for companies in the third quarter....422 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
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