Most of the time, the U.S. stock market
looks to 3 factors (call them the “pillars” that support the stock market) to
support its upward trend – let’s grade each of the pillars.

CONSUMER
SPENDING:  I grade this factor a C (neutral).

THE
FED AND ITS POLICIES:  I continue to grade this factor an A+ (extremely favorable) because the
FED cannot do much more than it is doing to support the stock market and asset
prices.  And, the FED announced on
9/18/2013 it intends to continue the highly accommodative policy to stimulate
the economy. 

BUSINESS
PROFITABILITY:  I graded this factor an A (very favorable).  NOTE:  3rd
Quarter profit reporting season continues this upcoming week.  Zacks Investment Research says
third-quarter earnings for the 355 S&P 500 firms that reported as of Oct.
31 were up 4.5% from the same 2012 period, with 67% beating expectations.
Revenue rose 2.9%, with 49% topping forecasts. 
We will maintain or grade of “A” based upon these results.

NOTE: 
the above grades are unchanged from last week.