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Scott Jagow: Wall Street is trying to assess the latest quarterly profit reports. Bob Moon looks at the winners and losers.
Bob Moon: Some of the corporate report cards were downright awful, but Wall Street’s been focused on the head of the class.
So while it’s true J.C. Penney did poorly, analyst Art Hogan at Jeffries & Company is paying more attention to Wal-Mart’s better-than-expected third-quarter results. He gives the retail giant passing grades, not only because of its size, but he says it’s not as reliant on discretionary consumer spending. And while residential real estate and mortgage companies predictably took a beating, tech stocks did well.
Hogan expects more of the same:
Art Hogan: As we wind down a year, you tend to have portfolio managers that chase performance. The losers get sold more and the momentum there continues, and the winners get bought more aggressively and continue to ride. So it tends to widen that gap between the winners and the losers, and the laggards fall further behind and the winners gain momentum.
All in all, Hogan argues, the latest quarter wasn’t awful:
Hogan: We’ve had a host of bad news. Some of it still lingers, especially on the financial side. But I think the broader economy may well be able to orchestrate a soft landing, and have a strengthening pattern next year.
For now it seems, Wall Street investors tend to agree.
I’m Bob Moon for Marketplace.
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