Chris Lee | forex

2nd August after Final Bell. Have the BULLS won again?

Aug 2nd 2010 at 3:07 PM
Final score : Dow: +205 S&P 500: +24 NASDAQ: +39 Today's news wasnt all that positive,although ISM did show a surprise increase. For those that have no idea what ISM stands for and its significance.Let me explain. The Institute of Supply Management (ISM) Manufacturing Index measures the activity level of purchasing managers in the manufacturing sector, with a reading above 50 indicating expansion. A rising trend has a positive effect on the nation's currency. To produce the index, purchasing managers are surveyed on a number of subjects including employment, production, new orders, supplier deliveries, and inventories. Traders watch these surveys closely because purchasing managers, by virtue of their jobs, have early access to data about their company’s performance, which can be a leading indicator of overall economic performance. The expected number for today was 54.2 but it came higher at 55.5 still below last month's 56.2. Construction spending was more but limited to increase in spending by government bodies. The private sector had a decline. So what's the fuss about? Why did the Dow Jones and S&P had a sudden bull run? Perhaps the individual investors are more confident after hearing most of the companys' reporting positive earnings and also that BP is about to stop the oil leak permanently by next week latest. In fact many companys do have lots of hard cash and have not yet decided where to invest or park their funds to generate wealth. However not all is so rosy at the ground level. Unemployment is stubbornly high,foreclosures are still at an all time high, many state governments are facing mounting debts and even the police departments are subject to austerity measures. Perhaps on Friday the markets will have more reason to cheer (or jeer) if the Non-farm payrolls show a positive increase,especially for the private sector. We shall wait and see. Have a great week trading! Chris
Please to comment
Sep 13th 2013 at 6:36 AM by marty
great,thx for sharing. mc

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