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See Saw Earnings Season. Do They Really Matter?

|Includes: SPDR S&P 500 Trust ETF (SPY)

When Alcoa Inc (NYSE:AA) kicked off earnings season on July 12th the stock market was in a bullish mode. The major indexes has bounced since the early July time frame and everyone was bullish in the media. The next batch of earnings that followed all translated to a negative reaction in their stock price. However, the market held up well trading higher into July 16th which was options expiration. On that expiration Friday the Dow Jones Industrial Average closed down 266.00 points that day. Google Inc (NYSE:GOOG) was one of the last major companies to disappoint the street and react poorly to earnings on July 15th.

Now it seems the market sentiment has shifted again. The market indexes are catching bids higher off of the Chinese government making comments that they may loosen credit instead of their earlier stance of monetary tightening. Most commodity stocks have been flying higher on these comments. However, one must question the length of time that this will last. All of the sudden the street no longer cares about earnings or corporate guidance. The street now cares about China and their economic policies. The Chinese government has now become the lead dance partner in the global economy. This is very similar to a poorly written soap opera. Stay tuned as July should be filled with fireworks.