This outlook from TXN backs our view that the market is at a tipping point of where demand remains strong and will so unless the market falls off the cliff. The market also hit a strong support level at 1,040 and bounce today which provides more support to the theory. Any break of that level likely places the market into the bear camp and leads to the downdraft in consumer demand.
Assuming the market bounces from this level, any damage of this correction will be quickly repaired. It's very common to have such a correction lead to at least a retest of recent highs (1,220 level) and usually much higher highs in the near term. Markets have overly reacted to fears of a total repeat of 2008. Absent that and we'll see a strong rebound. The report from TXN suggests that we're either on a cusp of a big rally or a big leg down. Something big needs to happen in Europe rather soon or the news as been nothing but overly blown fear.
Highlights from TXN:
- Revenue: $3.45 – $3.59 billion, compared with the prior range of $3.31 – $3.59 billion
- EPS: $0.60 – $0.64, compared with the prior range of $0.56 – $0.64.