The Sun Is Finally Shining On GM...

After I asked *The Question* 2 days ago -- whether GM might be a buy @ $21.25, -- the company's CEO took it upon himself to say that "No, we don't plan to file for bankruptcy any time soon", and the stock, of course, promptly proceeded to rally 13% (to slightly above $24 as of Friday's close). Lucky timing on my part I figure, though some sort of a snap-back rally was to be expected, I guess. In addition, let me also point out that nobody ever admits to planning to filing for bankruptcy (until it is time to!), especially if they are heavily vested in the equity of the company. So, all I am saying is that one should take GM's CEO statement with a pinch of salt, to say the least -- it's too early to tell whether GM will survive... or not. One thing is for sure though: Kirk is probably feeling a couple of years younger after those last 2 days.

And the market? As previously suggested, the inexorable rally in the SPX index is more the result of stubborn performance chasing (by desperately underperforming fund managers) than a real fundamental shift in the way investors perceive the U.S. market. Hence, I would expect a bit of consolidation around here (within the 1238-1250 range), before we slowly make our way up -- to what I deem to be an upside attraction point of 1275-80 in the SPX index. Just in time for X-mas I reckon.