The Closing Look

Stocks opened lower but closed higher on Wednesday after the latest round of lackluster earnings and economic data were released. Oil prices also positively reversed after the latest EIA report was released. Economic data was less than thrilling. First, February’s Flash PMI Services Index Fell to 49.8, miss estimates for 53. Then New Home sales plunged -9.2% last month to an annualized rate of 494,000, missing the Street’s estimate for 520,000. This clearly shows that the economy is slowing, not strengthening and that is a problem for both Main Street and Wall Street. Earnings data was also less than stellar. Avis -Budget Group (CAR) plunged over 23% after the company lowered guidance for 2016. The company lowered adjusted EPS to $2.70-$3.30, which was lower than the Street’s estimate for $3.43. Target TGT ($TGT) also missed estimates but the stock was not hurt because the company raised guidance.

Gary’s Thoughts: Wow…that was one heck of a reversal. Just letting you know fedheads out in force yesterday talking no rate hikes imminent! On Monday, markets hit a wall near the 50 day average. They will now get another attempt!