Stocks Are Becoming the Only Game in Town [Video]
The market's hot start to the month -- and remarkable resilience despite a surprise jump in the unemployment rate -- bodes well for the bulls into the home stretch of 2010 and beyond, says Cort Gwon, director of research and trading strategies at FBN Securities.
The Federal Reserve's second round of quantitative easing, or QE2, is having the intended effect of boosting assets prices, at least in the stock and commodities market, Gwon says. The way traders turned last week's bad news about jobs into good news for stocks was almost a perverse testament to the efficacy of the Fed's plan.
"QE2 is going to add $100 billion in liquidity per month for the next six or seven months," says Gwon. "And that's good because when you have a bad number like the jobs number on Friday, you're going to have the government add liquidity to the market."
"I'm fairly bullish here to until the end of the year and probably through the first quarter of 2011 because of money coming out of fixed income," says Gwon. "Rates are so low, people really have no choice or no option of where to put their money. It's going to come into the stock market."
For more on Gwon's view from the floor of the New York Stock Exchange (NYX), see the video above.