11:32AM Still too soon to start buying stocks: Smith Barney ($SPX) by Tomi Kilgore
NEW YORK (CBS.MW) - Smith Barney equity strategist Tobias Levkovich said that while the stock market's pullback hasn't been as bad as it appears, given that the S&P 500 Index ($SPX) was last down just 3.9 percent from its high, he thinks it is still too early to buy buying. He feels the broad market index could still fall another 10 to 12 percent by the summer. Levkovich attributed the weakness to a number of factors such as concerns over the sustainability of the economic recovery given the weak jobs picture, an expected peak in semiconductor industry growth rates and overly optimistic earnings growth expectations. "Moreover, the presidential elections loom and there could be some uncertainty now about the outcome given mixed economic data and recent polls," Levkovich said in a note to clients.
11:21AM Greenspan: We've promised too much to Baby Boomers by Rex Nutting
WASHINGTON (CBS.MW) -- Federal Reserve Chairman Alan Greenspan repeated his warning that future Social Security benefits will have to be cut. "We don't have the resources" to match the promises made to the millions of Baby Boomers who are about to retire, Greenspan told the House Education Committee on Thursday. Democrats on the committee argued that Social Security was being squeezed by trillions in tax cuts for the wealthiest 1 percent of Americans. "We have to make some choices," Greenspan said. It's not fair to those who will retire in the next generation to promise more than the society can afford, Greenspan said.
11:19AM Stock weakness due to 'half-empty' mentality: A. Paris ($INDU, $COMPQ) by Tomi Kilgore
NEW YORK (CBS.MW) - Barrington Research market strategist Alexander Paris said the stock market's weakness was simply a case of investors losing faith due to a lack of market progress, as there has been no significant shock or news to trigger the selling. "Essentially, investors have shifted to a 'half-empty' from a 'half-full' mentality," Paris said in a note to clients. But because he believes underlying fundamentals will likely remain positive for a few years, Paris thinks the market may be just backing up now for a "more powerful assault" to the upside later. But he noted that there must be a trigger to get sidelined investors to start buying. He thinks that could be the sell-off itself, as lower prices attracts bargain hunting, and likely positive news flow, such as healthy first-quarter corporate earnings and a stronger-than-expected employment report for March. The Dow industrials ($INDU) was last down 53 points at 10,244 and the Nasdaq Composite ($COMPQ) was off 5 points at 1,959, down 3.2 percent and 3.5 percent, respectively, since the end of February. |
