Today's Market Update with...

Harvey Katz, Value Line's Managing Editor

The stock market began the new week on another strong note yesterday, and following the release of strong earnings from Apple after the market closed yesterday afternoon, the equity futures are pointing to a solid gain at the open this morning. The bull, it seems, just can't be held down.

All told, the Dow Jones Industrial Average rose 96 points yesterday, to place that 30-stock index within eight points of 10,100, while the NASDAQ added 20 points. Oil also rose, on hopes for the economy, and now stands within pennies of $80 a barrel. How far down the road can inflation be? Apparently, it may not be very far.

As for the market, it was helped by additional favorable profit reports, which should continue today and over the balance of the week. However, things are not as uniformly positive on the economy, with data just issued moments ago showing that housing starts edged a bit higher in September, while building permits fell back surprisingly.

We note that housing and many other indicators, while showing irregular improvement in the main, are still at low levels on an absolute basis. This underscores the likelihood that the presumptive economic recovery will be an understated affair. At the same time, producer, or wholesale, prices fell more than expected last month, a trend that probably will not continue if the oil price surge is sustained.

Anyway, the path of least resistance on Wall Street, seems to be higher. The question is just when will the profit takers come in? Stay tuned for more updates on this subject and others.