The Government came out this morning and reported a 0.3% increase in retail sales for the month of January. This marks the seventh straight month of an increase however, this was far less than what economists expected, hence the markets retreated. Albeit a very modest pullback for the bellwether indexes. I think for most of the bulls out there this is just fine. I have been saying for sometime that pullbacks and even reasonable corrections are very healthy for a continuing bull market. We simply have not gotten a meaningful pullback or correction over the past several months and I think from a technical perspective that would be a welcomed sight.
Having said this, in one of my previous blogs I referred to the need for top-line growth out of corporate America as one of the key factors for the current market rally to continue. With the bulk of the 4th quarter earnings reporting season behind us, it seems like revenues are picking up and businesses are not just relying on cost cutting measures and layoffs to fuel their bottom line. With top-line sales growth beginning to surface, just maybe this translates into job growth which should bode well for this market.
All the best 🙂