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Dow Continues To Push Higher On Earnings Optimism

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http://www.nytimes.com/2009/07/22/business...ml?ref=business

Solid earnings reports and upbeat outlooks from big-name companies fed the latest round of optimism on Wall Street, pushing stocks higher.

Shares rallied in early trading Tuesday as Caterpillar joined other companies in issuing improved 2009 profit forecasts. Caterpillar is considered a bellwether of the global economy so its guidance was particularly encouraging to investors.

Meanwhile, both the chemical maker DuPont and the drug company Merck reported drops in their quarterly profit, but results still came in ahead of Wall Street’s forecasts.

In the first few minutes of trading, the Dow is up 56 points or 0.68 percent. The Standard & Poor’s 500 index and the Nasdaq were up slightly.

Major European markets were at least 1.2 percent higher Tuesday amid the latest wave of earnings and ahead of an appraisal of the economy from the Federal Reserve chairman Ben S. Bernanke.

The FTSE 100 index in London was up 1.2 percent while the DAX in Frankfurt rose 1.9 percent. The CAC-40 in Paris was 1.5 percent higher.

Earlier in Asia, Tokyo’s market outperformed the region to hit a two-week high after being closed for a holiday Monday, as investors seemed to shrug off the unfolding shake-up in Japanese national politics. Japan’s Cabinet agreed to dissolve the powerful lower house of parliament, setting the stage for national elections that could topple the country’s ruling party.

Tokyo’s benchmark Nikkei 225 stock average closed up 256.70 points, or 2.7 percent, to 9,652.02, but Hong Kong’s Hang Seng ended down 0.64 point at 19,501.73.

In other earnings, the UnitedHealth Group said its second-quarter profit more than doubled compared with the year-ago period, which was weighed down by large lawsuit settlements. The health insurer also raised its profit outlook for the year. The Coca-Cola Company, the world’s largest beverage maker, said its earnings jumped 43 percent even as sales fell, beating analysts’ estimates.

Earnings reports have largely exceeded expectations so far this earnings season, fostering a renewed sense of optimism in the market and helping to drive the Dow Jones industrials back into the black for the year. Though the bar had been set fairly low, the results were still an encouraging sign that the recession is taking less of a toll on corporate America than it was just a few months ago.

Looks like all that QE money has done something, no wonder they want to keep printing.

Plus how much is down to cost cutting and getting rid of excess staff? You can only cut so far before you don't have enough to staff to produce the products / service. What then?

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http://www.nytimes.com/2009/07/22/business...ml?ref=business

Looks like all that QE money has done something, no wonder they want to keep printing.

Plus how much is down to cost cutting and getting rid of excess staff? You can only cut so far before you don't have enough to staff to produce the products / service. What then?

Then prices start to rise and rise and rise and rise.

We are already in hyperinflation, the effect takes time.

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Actually slightly negative on the day at the moment after less then flattering comments from Bernanke & Caterpillar.

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I'm 30% in ETFs now in my stocks and shares ISA account.

Very tempted just to get 100% in but really want to be ready to pounce on a big downleg but have we already hit bottom and at the start of a new bull market. Bears could be made to look very silly indeed if that is the case.

I just can't see a lose decade AKA Japan. Westerners just won't revert to the tight lipped saving everything, spending nothing like the Japanese. Or will they?

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Also decoupling is happening. China and the developing nations are clearly decoupling now from the western economies. Companies like Catepillar and Coca Cola, their future is selling into the developing world.

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Guest Daddy Bear
Also decoupling is happening. China and the developing nations are clearly decoupling now from the western economies. Companies like Catepillar and Coca Cola, their future is selling into the developing world.

Over the next 12 months the DOW (& Global Stocks) will continue to rise - people will assume it is the recovery.

It will be a False Dawn - The most prescient are already getting on board.

What has added to my beliefs recently?

$23, 700,000,000,000

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