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Politics : Idea Of The Day -- Ignore unavailable to you. Want to Upgrade?

To: IQBAL LATIF who wrote (39632)	5/11/2001 8:57:02 AM
From: IQBAL LATIF	Read Replies (2) \| Respond to of 50167

On robust consumer spending! according to dismal.com, <<Retail Sales for the month of April increased 0.8% from March better than the 0.1% expected. Excluding auto dealers, sales were up 0.7% from the prior month versus an expected increase of 0.4%. The report indicates that consumer demand has stabilized in April after recent weakness and will provide the FED reassurance that the consumer spending continues to provide fuel to the economy. However, this data alone should not decrease the likelihood of another 50 basis point rate cut expected at next Tuesday’s FOMC meeting given that rising employment concerns, and eroding consumer confidence should provide a difficult backdrop for near term consumer demand. Figures released today.>> My take is the following, Initially the market will think that this kind of spending is not good for the rate cuts and may test the 1228 area but when realisation sinks in that rate cuts are not the goal the goal is revival and if revival cannot be celebrated than someone else will pick the cherries and on that count the market will rebound from that 1246-48 area to go higher and close above that 1268 ideally that will be my call. Other than oil prices direction that I have been talking about consumer spending is the other area, other cause of disagreement on the direction of the economy was consumer spending, my critics believed that in March their will be catastrophic drop in consumer spending that would be the beginning of the next phase taking us through the 1080 area on SPX a further drop of 25% was anticipated. Now look at this consumer spending it clearly does not indicate any kind of recession at least, we have seen the adjustment of huge bubble in technology but it is matter of time that DOW picks from here and take out the 11,000 mark, the support at 1250-55 area has been indicative of the higher band level towards 1328-1300 and NAZ points to 2500-2800 area where we may see consolidation that may bring the NAZ down to 2000 twice by July 30th and DOW to 10200 with 1200 tested also. At lows of the range a long trade and at the highs a short one will help us for interim until we see some growth in the tech sector.