The Institute for Supply Management will release its latest survey on manufacturing at 10am, and all eyes will be on the headline index which should finally break through 50 – the break even mark between expansion contraction.
It’s hard to believe that little over a month ago, investors were holding their breath to see if the S&P 500 had enough momentum to burst through 950 – a psychological level that had held firm since November of last year. Carry through buying Monday from last week’s renewed cheer that the U.S. and global economies were leaving recession behind has pushed the S&P 500 to 1033, its highest level since Oct. 6, 2008 when it traded at 1056.89.
Sure they’re still cutting jobs, by nonfarm payrolls are shrinking at slower pace, down only 247K in July, and the unemployment rate actually fell to 9.4% from 9.5%. With other data showing a tentative turning point in housing and manufacturing moving toward expansion, this is starting to feel like the real deal.
LONDON, July 24 (Reuters) – Investors have proved all too ready to interpret positive earnings trends from Intel, IBM and Apple as signs of economic recovery and to justify a continued rally in technology stocks.