April 11, 2001
Rumor-Based Dow Rally Losing Steam
Yesterday, the market devoured rumors that Motorola's earnings would be better than expected. But it turned out to be far from an up-lifting earnings report. Not only did Motorola report a wider-than-expected loss, its first loss in more than 15 years, the company also announced that next quarter's earnings will be even worse and that an additional 4,000 employees will lose their jobs.
Motorola's forecast certainly doesn't signal a turnaround in the economy. Indeed, the bear market rally is starting to sputter already. But, whatever you do, don't jump in too early. It's just when you think stocks have hit rock bottom, that the floor falls out beneath them. As we've said, this rally could last weeks before stocks inevitably resume their nosedive.
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