Friday, January 20, 2012 Market Commentary

The labor department reported that weekly jobless claims dropped more than expected, by 50,000, with 352,000 new claim fillings – a four year low. Additionally, Markets were encouraged by better than expected earnings from Morgan Stanley and Bank of America. Industrials and Financial shares led the markets higher.

After the market close yesterday, Intel (INTC)*, Microsoft (MSFT)*, and International Business Machines (IBM)* reported better than expected earnings, while “the new kid on the block” Google (GOOG)* missed estimates, causing that stock to drop by some 10% in afterhours trading. Google’s results may well weigh on the markets this morning. However, if General Electric (GE)* delivers strong results this morning, markets may take their cue from the giant technology and financial services company.

Commodities, in particular Aluminum, Copper and other base metals fared well yesterday on speculation that China will retain its accommodative fiscal and monetary policy for a while. Reuters reports “China's manufacturers started 2012 in a sluggish mode, suggesting Beijing will keep pulling pro-growth policy levers despite some early signs that a downward drift in factory activity is slowing, a survey of purchasing managers showed on Friday.”

* Clients and employees of GGPS & GGCO may own these securities in their discretionary investment management accounts or self-directed brokerage accounts.