Weak economic news pushes down the market a bit

The stock market made a very weak high on Wednesday and then fell the rest of the week. Economic news continues to be grim:

2nd quarter real GDP only 1.2%
2nd quarter after-tax corporate profits -2.2% (-2.3% in the 1st quarter)
July existing home sales -3.2%
Consumer sentiment 90 in August (90.4 in July)

There is a marked dichotomy between the Technical Group and the Cyclical Group in my stock market sector table. The Technical Group has solid gains in all except the Telecom and Pharmaceutical Sectors. Many of these gains are hollow, however, as I showed in my last two reports, but they’re gains nevertheless. The Cyclicals Group has big losses in the Basic Materials, Real Estate and Retail Sectors. The market tends to be solidly bullish when both the Cyclical and Technical Groups are both gaining in relative strength.

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