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Momentum versus Economics
Posted By Barry Ritholtz On December 4, 2006 @ 2:33 pm In Economy,Markets,Psychology | Comments Disabled
Momentum traders continue to drive stocks higher, regardless of what the economic data is.
The latest bit of Reality intruding into the party? A warning from Lansdstar (LSTR), a $2.3B trucking company, which warned:
Landstar System CEO says lowers forecast for Q4 diluted EPS to between $0.44-$0.49/share, lowers Q4 revs to $620 mln and $635MLN – Reuters
Consensus is for Q4 EPS of $0.52 and revs of $697.5 mln.
That’s not exactly a horrific miss — its a range that might only be a few cents off from the prior expectations.
Here’s what it did to the Trannies:
Given the momentum into the market today — light volume notwithstanding — I wouldn’t be surprised if the market shakes it off and keeps going . . .
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