GDP Points to a Slow Recovery

After Monday’s dramatic rally, the major indices eased their pace yesterday, closing the session in red. Even though a minor pull back was expected by most investors, many expressed concerns that the current equity rally is now running only on steam. One must note that even though various sectors are now showing improvement, the employment situation is still weighing on investor’s thoughts and on the economic situation.

According to a recent statement from the Fed, consumer consumption is picking up, but the economy should witness a slow recovery, due to the high level of unemployment. The Fed also mentioned that without further stimulus from the government, the U.S could find it hard to recover to a normal and healthy situation. According to yesterday’s revised economic data the U.S expanded by 2.8%, a number which was under analyst’s expectations of 2.9% and lower than the previous figure of 3.5%.
President Obama also expressed his concerns yesterday, stating that even though the economy could require further stimulus, additional debt could lead to a drop in confidence which could lead to a double dip recession.
From a technical point of view the major U.S stock indices finished the session around recent high levels. The S&P500 closed with a -0.05% loss, while the Nasdaq dropped by 0.31%

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