Is That a ‘V’ Bottom or the Dreaded Double-Top?

Despite reassurances that the Federal Reserve has no immediate plans to ease stimulus, stocks closed only slightly higher Wednesday. Chairman Ben Bernanke emphasized that decisions would be flexible and depend on “incoming data,” which measures inflation and other economic results.

Housing starts for June hit an annualized rate of 836,000 units versus an expected 958,000. There were no surprises from the Fed’s July Beige Book, which showed that housing was running at a “moderate to strong” pace and wage growth was “modest.” It also noted that the Chicago and Richmond districts reported a solid demand for part-time workers.

At Wednesday’s close, the Dow Jones Industrial Average was up 19 points to 15,471, the S&P 500 rose 5 points to 1,681, and the Nasdaq gained 12 points at 3,610. The NYSE traded 676 million shares and the Nasdaq crossed 372 million. On the Big Board, advancers exceeded decliners by about 2-to-1, while on the Nasdaq, advancers were ahead by 1.4-to-1.  (more)

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