The Morning Rally Fades

The market couldn’t hold on to its early gains, but we saw some strength going into the final 30 minutes. We were still up for today but not as much as we had been. The S&P 500 is above 810 which is a good sign.

One fact that could be weighing on the market was the poor government bond auction in Britain. The government wanted to auction off 40-year bonds but there simply wasn’t enough interest. The same thing could soon happen at a U.S. Treasury auction.

The big news tomorrow will be the final report on fourth-quarter GDP growth. According to the previous revision, the economy contracted by 6.2% for the final three months of 2008. I wouldn’t be surprised to see that revised lower tomorrow. The only bright spot is that the fourth quarter ended nearly three months ago.

More Louis Navellier

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