- Market Commentary -

January 25, 2010 (FinancialWire) (By Genevieve Hawkins) — Stocks were slammed hard last week as stellar profit reports from the likes of Google (NASDAQ: GOOG) failed to impress skittish investors; but a rebound may be in the works.

Last week the Dow dropped 4.1%, the S&P 500 plunged 3.9% and the Nasdaq declined 3.6%, as tightened lending by China and the promise of new bank restrictions in America caused investors to run for the hills. This may be the start of the long awaited market correction, but with the volatility index jumping so quickly and contrarians so often rewarded, it could prove best to jump in as others are jumping out.

The coming week will include a litany of economic data and corporate earnings reports. Investors will also be paying close attention to the Federal Reserve’s two day meeting on interest rates – although the Fed is widely expected to keep rates at historical lows, market watchers will be more interested in their take on economic conditions. GDP is expected to rise substantially, while existing home sales will likely show a drop in December. Wall Street’s direction will be dependent on interpretation of the results.

It’s likely to be a choppy, volatile week. The bulls may win out by merit of taking advantage of frightened investors.

[Go to http://www.financialwire.net/?s=genevieve+hawkins to see more commentaries by Genevieve Hawkins.]

The FirstAlert(tm) Economics Calendar lists Existing Home Sales for December (10 a.m.), Treasury auctions 3&6-month bills (11:30 a.m.).

The FirstAlert(tm) Events Calendar showcases MHS, GXDX, PSYS, BIOS at Jefferies Global Healthcare Services Conference.

FirstAlert(tm) Website of the Day: http://www.metoffice.gov.uk/corporate/pressoffice/anniversary/storm1990.html

Quote of the Day: “On the outskirts of every agony sits some observant fellow who points.” Virginia Woolf

Today is: Room of One’s Own Day, Bubble Wrap Appreciation Day.

Happy Birthday: Robert Boyle, Robert Burns, William Somerset Maugham, Virginia Woolf, Edwin Newman, Buddy Baker, Steve Prefontaine, Alicia Keys.

Today in History: Edward III became king of England in 1327, while in 1494, Alfonso II was crowned king of Naples. Henry VIII of England secretly married his second wife, Anne Boleyn, in 1533. São Paulo, Brazil, was founded in 1554. Moscow University was established on Tatiana Day, 1755. The British Parliament passed the Constitutional Act of 1791 and split the old province of Quebec into Upper and Lower Canada. Thomas Edison and Alexander Graham Bell formed the Oriental Telephone Company in1881. In 1915, Bell inaugurated U.S. transcontinental telephone service. Russia declared a republic of Soviets in 1918. Thailand declared war on the United States and United Kingdom in 1942. David Ben-Gurion became the first prime minister of Israel in 1949. In Washington, D.C. in 1961 John F. Kennedy delivered the first live presidential television news conference. The Burns’ Day storm hit Northwestern Europe in 1990. Opportunity landed on the surface of Mars in 2004.

[FirstAlert(tm) was created by Gayle Essary, founder of Investrend Communications, Inc., parent of Investrend Information. The opinions expressed in FirstAlert(tm) do not necessarily reflect the opinions of Investrend.]

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