PreMarks: {07.11.12}

Pre-markets indicate a higher open.  The reasonings offered up this AM seems to be a combination of further positive news on the bailout of Spanish banks and a few more solid seeming economic reports.  I think the real reason is that after four down days stocks are oversold enough short term to rally.  Speaking of data, it continues to show a global economy that has hit a rough patch.  Whether this is similar to the past couple of years when the economy has shown a slack period in the summer or the beginning of something else is still to be determined.  

Market estimates continue to come towards our 103.75 S&P 500 earnings number and that has not helped stocks in this period.  At that level of earnings and with stocks trading around 1340 stocks are still attractive as long as we don't see further deterioration in corporate profits.  

The great de-leveraging in this country continues.  While individuals continue to pare their own personal balance sheets, governments at all levels continue to do so as well.  San Bernadino becomes the third California city to declare bankruptcy.  Look for this trend to continue as a way for cities {maybe states?} try to work their way out of stifling pension and worker obligations.   

More after the market opens......

*Long ETFs related to the S&P 500 in client and personal accounts.