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Holiday May Hinder Any Bullish Moves

November 20, 2000|Reuters

Wall Street bulls will pounce once the long-running U.S. presidential stalemate is settled, but they may have to sit it out this holiday-shortened week. "If there's no resolution, [today] and Tuesday will be under that cloud," said Larry Wachtel of Prudential Securities, who expects a rally once the nagging question of who will become America's next president is put to rest. "The market has switched from the Three E's--energy, the euro and earnings--to the Three Fs--forecasts regarding earnings, the Federal Reserve and the Florida elections debacle," said Peter Cardillo of Westfalia Investments. The elections picture may change soon. But even if there is a knee-jerk move higher when the question is settled, the jury is still out on whether that rally would be sustainable. The Street already is looking ahead of the curve to a time when the Fed will quit raising interest rates or even cut them. That would bode well for the market, as lower rates cut companies' borrowing costs and stocks become more attractive as investments. The rhythm of trade will be colored by the Thanksgiving holiday Thursday when the market closes, and traders warn of more market swings on a thinly staffed Wall Street as many traders will take a long holiday starting Wednesday.

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