We’ll see exactly what the fear level is today when U.S. stocks get a chance to react to this morning’s revision of first quarter U.S. GDP growth.
Economists had projected that the Bureau of Economic Analysis would raise its estimate on first quarter GDP on its first regular review of the initial numbers to 3.3% from 3.2%. The Bureau, however, actually lowered the estimate for U.S. growth to 3% for the quarter.
Now granted this is all backward looking. The real worries are about future economic growth—that is Will the U.S. economy slow in the second and third quarters of 2010? First quarter numbers, even revised first quarter numbers, are old news.
But still today’s headline number shows that the economy was weaker than thought. If investors are really twitchy that would be enough to set of selling, especially in front of the long Memorial Day weekend.
The GDP revision will get overshadowed by reassuring remarks from China this morning that the country isn’t selling euros.
That’s put European stocks in a good mood and that’s likely to start the U.S. market in a positive path too.