I would be very cautious this morning. What's new. But I am very suspicious about the strength here and would seriously consider selling into the open any overnight trades. I don't think we break SPX 1408 or hold that level very long. I would look to nibble 1388 and if we fall back through that look to 1368 again....this is the sideways trading range I'm expecting.
Economy advanced at unrevised 5.4% pace; inflation gauge unchanged
May 25, 2000: 8:50 a.m. ET
NEW YORK (CNNfn) - The pace of the U.S. economy remained robust during the first three months of the year, though not as frenetic as in the fourth quarter, as consumers continued to spend and businesses racked up profit, according to revised government numbers released Thursday.
Gross domestic product, the broadest measure of goods and services produced, advanced at a 5.4 percent pace in the first quarter, the Commerce Department said, the same pace as initially tallied a month ago and slightly above analysts' forecasts for a revision to a 5.2 percent gain.
The GDP price deflator, a key inflation gauge, rose at a 2.7 percent annual rate, the same rate initially recorded a month ago and in line with economists' forecasts. The price deflator rang in at 1.9 percent in the fourth quarter.
Consumer spending fueled much of the gains, advancing a revised 7.3 percent in the first quarter, though at a slower pace than the 8.3-percent jump initially reported in April. Still, that was up from 5.9 percent in the fourth quarter of last year and was the strongest increase in nearly 15 years, since a 7.5 percent advance in the third quarter of 1985.
Spending accounts for more than two-thirds of total economic activity, and has become the key target of the Federal Reserve's campaign to cool growth by pushing interest rates up six times since last June. |
