Courtesy of John Nyaradi.
Indexes and Index ETFs ended First Quarter 2012 on a mixed note – can the bulls keep up the charge for Q2 2012?
What a great first quarter! And for the bulls’ sake, at least the S&P 500 and the Dow did not roll over and die today like their Nasdaq 100 and Russell 2000 counterparts.
Indexes and Index ETFs had mixed party today, as the S&P 500 rose .37% and the SPDR S&P 500 ETF (NYSEARCA:SPY) rose .41%; the Dow Jones Industrial Average gained .50% while the SPDR Dow Jones Industrial Average ETF (NYSEARCA:DIA) gained .51%; the Nasdaq 100 lost -.12% while the PowerShares QQQ Trust Series 1 ETF (NASDAQ:QQQ) lost -.19%; and the Russell 2000 Index lost .23% while the iShares Russell 2000 Index ETF (NYSEARCA:IWM) lost .32%.
Before we go into today’s events, a quick recap of the last quarter: The S&P 500 gained 12% since January 1st, this is the S&P’s best first quarter since 1998. The Dow Jones Industrial Average gained 8.1% to make it the highest gaining first quarter for the Dow ever, and the Nasdaq 100 rose a meteoric 18% since January, having broken its 11 year highs twice. A look at the PowerShares QQQ Trust Series 1 ETF (NASDAQ:QQQ) below should tell you everything you need to know about First Quarter 2012:
Look At That Nice Diagonal Line!
Perhaps today’s mixed economic reports threw a wrench in today’s anticipated party, although not all news was bad. Personal spending gained .8% for February while personal income only rose .2%. Spending more money is good, but only if one is making more money too. Chicago PMI, which indicates economic activity in the Chicago area, dropped for March, while overall consumer sentiment increased from 75.3 to 76.2 on the consumer sentiment index. All in all, a mixed bag of reports, as consumers on a whole are feeling better about the economy, perhaps with the hope that more money is on the way to spend.
So, looking ahead for second quarter: can the bulls keep up the charge? As far as markets are concerned, the bulls need to gain some serious momentum to break the ceiling they have created for themselves in the last two weeks, this will be a feat if successful. Granted, if Dr. Ben and his Fedsters continue to promise more free money, its really anyone’s guess.
From a more general perspective, the last two weeks have been flat for sure, especially considering the high gas prices and the new drama emerging from Europe involving Spain and further austerity measures. Considering that the general mood of the US economy has been fairly positive in terms of economic reports and growth, it could be safe to say the the US economy is recovering, albeit slowly. Keep in mind that anything negative overseas has the power to turn our recovery party into an all out circus of depressing proportions.
Bottom Line: A great 1st quarter. Will we have a great 2nd quarter? Strap on your seat belts, this could get exciting.
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