As I reported in a prior blog - the Dow Jones made a spectacular run from its March lows to cross the all important 10,000 mark in October. At the time I predicted that the market was likely to hover around this area until reporting seasong began in late January. Now that it is late January, it is worth noting that the Dow Jones is currently at 10,194 - and has risen less than 2% more than three months since the previous article.
Reporting season will give direction to the markets, whether that be up or down, and will set the tone for the year. Any whisper, murmer or hinting at debt repayment issues or re-financing will send markets spiralling downwards. Whilst any indicator of growth will be quickly interpreted as good news to drive markets a little higher.
I personally feel as though the USA will have inflationary issues to deal with in the second half of 2010 that will halt any major growth. And a year end prediction of somewhere between 10,600 and 11,000 is my best estimate*.
*This is not investment advice, merely and opinion.