The Stock Market Desperately Needs The Economy To Perk Up

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		Tech Science Entertainment Wall Street Markets Strategy Sports Lifestyle Politics Law International Video Latest Tuesday, July 24, 2012 The Stock Market Desperately Needs The Economy To Perk Up Last week, Lance Roberts pointed us to a stock market chart that showed if 2012 were to repeat 2011, than stocks should collapse within days. LPL Financial's Jeff Kleintop points at the pattern again in his weekly market commentary.  But he goes one step further to show the divergence between stocks and the Citigroup Economic Surprise Index, which measures whether economic data comes in better or worse than estimates. Lately, disappointing economic data has caused the CESI to fall, while stocks have been relatively resilient. Here's Kleintop's comments: For the gap between market and economic performance depicted in Figure 1 to close, either upcoming economic data must surprise to the upside or stocks need to drop sharply. It is notable that a gap similar to the current one appeared in July of 2011. Ominously, that gap closed with a sharp drop in the S&P 500, as you can see in Figure 2. In other words, if the relationship between stocks and the CESI holds, than stock investors are going to want economic data to start surprising to the upside again soon. Read » Also On Money Game Today: Deutsche Bank's Joe LaVorgna Expects Tomorrow's New Home Sale Number To Just Be Noise Here's Zillow's Exquisite New Home Price Forecasting Widget UBS: Pressure Is Building And We Could See A Big Stock Market Sell-Off Before The Year's Over US Government Borrowing Costs Hit New All-Time Lows Advertisement CHART OF THE DAY: The Spanish Disaster Indicator Is Going Berserk CHART OF THE DAY: The Great European Compression CHART OF THE DAY: Are You Ready To See A Totally Bonkers Soybean Chart? Share this: Facebook Twitter Digg Reddit StumbleUpon LinkedIn The email address for your subscription is: ipat39@gmail.com Change Your Email Address | Unsubscribe | Subscribe | Subscribe to the Money Game RSS Feed Business Insider. 257 Park Avenue South, New York, NY 10010 Terms of Service | Privacy Policy

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