Bulls End The Market Week in Control

A strong finish to the week for American Markets as investors piled back into stocks after some surprising news. July New Home Sales were stronger than expected and that lifted sentiment across the board. Deep in the midst of a so-called credit crunch and fears of a creeping recession the numbers highlight that through it all the economy is still stable and healthy.

The Dow went forward 140 points (1%) while the Nasdaq and S&P fared slightly better. On the Canadian side positive bank earnings at Toronto-Dominion (TSE:TD) led the TSX index higher but Royal Bank (TSE:RY) faltered despite profit increases. On the American side brokerages went higher together today following the general market despite Morgan Stanley (MS) cutting its retail sales outlook.

Investors have seemed to calm themselves of fears of recessions and credit crunches for the time being, which bodes well for the sustainability of the recent recovery of the major indices. The Dow sits about 750 points from its highs of the year meaning that the losses from those highs now sit at only about 5%. I believe its safe to say that the markets have stabilized the so-called correction, with the help of the Fed, and are now looking ahead to future interest rate discussions.