Today's Key News - GDP, Who Cares?

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Despite today's GDP revision and sturdy jobless figure, the NASDAQ is down while the S&P 500 and the Dow Industrials are just barely keeping their heads above water.

Asia:
Hang Seng Index +1.37%; Shanghai/Shenzhen 300 -0.51%; NIKKEI 225 +0.05%; Taiwan TAIEX +0.77%; BSE SENSEX 30 +0.74%; KRX 100 +0.79%; Ho Chi Minh +3.58%

U.K., Europe & Middle East:
DJ STOXX 50 Index +1.05%; FTSE 100 +0.91%; CAC 40 +1.42%; DAX +1.18%; Russian RTS Index +0.77%; Tel Aviv 25 +1.52%; Tadawul All Share -1.57%; DSM 20 -0.36%


Key Headlines:

• *** In a rare change for a third revision, Q4 GDP growth was revised higher to 2.5% from 2.2% previously reported (3.5% initially). This added lift to the market this morning by relieving some recessionary concern. Still, the news might lead some to consider the door opened wider for a potential rate hike to temper inflation, but there was some other noteworthy news in the report. Prices paid for personal consumption expenditures, excluding food and energy, were adjusted lower to a 1.8% annual growth rate in Q4, versus a previously estimated 1.9%. The inflation metric is favored by the Fed, and would seem to appease them. You already know Wall Street Greek's view of any inflationary figure that excludes the secular driven pressures on food and energy prices. Despite the good news, the market lacks the conviction to recover today. Wall Street Greek believes what is tempering enthusiasm, outside of all the usual suspects, is the fact that Q4 does not matter all that much anymore. Q1 is about to end, and indications are that GDP growth is slowing. Also, if Q4 GDP benefited from inventory growth, there may be increased risk that inventory was not sold off in Q4 and Q1 as anticipated, meaning a lesser degree of inventory replacement took place. Durable goods orders seem to support that argument. Also, Q4 investment in equipment and software was revised lower within today's report.
• *** Weekly jobless claims measured 308,000, below the 320,000 that was expected and the 318,000 that was reported for the prior week. Famed fixed income investor Bill Gross, during a relatively recent appearance on CNBC, pegged this metric as the most important economic indicator to follow in the near term. Wall Street Greek expects unemployment to increase as carpenters, electricians, plumbers, real estate agents, mortgage brokers, lending associates, and eventually, retail personnel hit the streets looking for jobs this year.
• *** Marc Faber, famous for predicting the market crash of 1987, was quoted by Bloomberg today saying "financial stocks are not performing well and this is usually a bad indicator for the market." Wall Street Greek agrees, if you caught our article today, which was reconstituted from last night's "Late Night With the Greek."

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