The stock market opened with a negative bias after getting worse-than-expected Q2 results from Intel, Yahoo, and General Motors, writes Tony Sagami, owner and founder of Harvest Advisors. Alan Greenspan added to the pity party with he told the House Finance Committee (more below) that the Fed wasn’t finished raising interest rates.
The Dow Jones lost more than 60 point in the first hour of trading and spent the entire morning in the red.
Of course, the bulls aren’t very interested in silly things like earnings and interest rates, and managed to push the Dow Jones into positive territory in the afternoon.
What the bulls did was focus on the drop in the price of oil below $57 a barrel and completely ignore everything else.
The Dow Jones closed with a 42-point gain, the Nasdaq Composite hit a new high for the year, and the Russell 2000 hit an all-time high.
Fear no evil has been the most successful investment strategy lately. After all, who cares about Intel, Yahoo, and General Motors?
Greenspan warns of more rate hikes to come. A growing group of bulls have been praying that Greenspan and his Fed buddies were finished raising interest rates.
As usual, the never-meet-a-stock-I-didn’t-like crowd is dead wrong.
At this semi-annual report to the House Financial Services committee, Greenspan made it very clear that more rate hikes were coming.
“Our baseline outlook for the U.S. economy is one of sustained economic growth and contained inflation pressures.