Friday, October 21, 2011

Europe Still Drives Market

Wall Street's obsessive concern with the Euro debt crisis continued to shape results this week;nor is any change in the offing.Even though U.S. banks actually have only limited exposure to Europe,traders think they will suffer greatly from European failures.In the end,it's what traders perceive that determines market direction.
Optimism about the crisis was the prevailing wind by the end of the week as Euro-zone finance ministers approved of the next round of aid to Greece and a series of European Union summits will be held beginning Sunday.For the week,the Dow gained 1.41,while the NASDAQ lost 1.14 and the S&P rose 1.12.Decent earnings reports from Honeywell,GE and Microsoft also gave the broader market a final nudge upward.GE stock declined for its manufacturing results,but the company did issue a positive outlook and a satisfactory overall report,which helped stem any sell-off tendency.
Next week,the results of the EU summits may be all-consuming.Any hint of failure would seem likely to derail equities,and EU success could ignite a major rally.
The S&P futures were up strongly Friday evening,rising 25.25,and bond index futures fell.
At the Children's Miracle Network Hospitals Classic at Lake Buena Vista,Florida,a three-way tie for the lead occurred among American Justin Leonard;Swede Henrik Stenson;and South Korean Bio Kim,all coming in at 12 under par.Leonard,39,has scored 12 career PGA Tour wins and more than 30 million dollars in career earnings.
General Electric(GE),Honeywell(HON),Microsoft(MSFT)

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