I think we are likely to remain in a trading range for some time.
Profitability in the first-quarter and beyond is going to continue to be strong and the broader economy is clearly in a recovery phase.
I think the stock market is digesting a very strong end of the year.
I think if the convention is perceived as successful, and you see the expected bounce in the polls for Bush (versus Democratic nominee, Sen. John Kerry), that might reassure investors and prove a short-term positive for stocks.
This trend of the stabilization of the broad stock market we've been seeing lately will continue through the year. We saw a sharp recovery in stock prices last year, but right now stocks are fairly valued versus the underlying fundamentals.
As the major indexes move near four-year highs, there are some risks for stocks. But the economy is growing at a solid pace, as the payrolls number showed, bond yields remain low and there is still excess of capital out there, looking for good returns.
People have been concerned that Intel's margins are in contraction mode, so what they say about that will be noteworthy.
The earnings reports are going to be the big driver in the next few weeks. What companies say they earned in the fourth quarter is going to be less important than what they say about the rest of the year.
I think Greenspan basically said the obvious, that long rates are too low and against his desire for the economy to grow ... His comments indicated that the Fed will remain in a tightening stance and that we should see further raising as the year progresses.
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