We won't likely make a huge run back to Nasdaq 4000, but it feels like the worst is close at hand, if not already here. You've seen the negatives and positives about the market outlined so much in the past few weeks that I won't bore you with details. But a few key issues may provide us with the upward move out of the consolidation phase that I believe we started Wednesday. First, we had the University of Michigan sentiment survey come in with a higher reading. If we can see a rise in consumer confidence follow this, we may just have stability in the consumer area, which in turn would bode well for demand.
Business confidence is still weak.
However, the new-orders component of the National Association of Purchasing Management reading rose in the most recent report. When the same thing happened after the downtrend in 1991, it marked the stage of the market recovery. Find out in Part 2 of this column. At time of publication, Schumacher had no positions in any securities mentioned in this column, although holdings can change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks.