Given the spike in oil during the third quarter, I think we're going to see higher oil costs in manufacturing companies and lower sales in consumer companies from oil squeezing out other purchases.
People are already reeling from high prices at the gas pump. I think they're going to be reeling even more from higher heating costs.
Companies are beginning to tell the markets they are going to take a hit from both Katrina and higher oil prices. Demand for stocks in the short term may slow down.
There's still a lot of concerns about the impact of higher interest rates and energy costs weighing on the stock market. And after the rally in stocks we've seen this week, investors just took a pause.
The guidance to a higher number for the year just shows that the core business is extremely strong and the company is confident that it continues to strengthen for the rest of the year.
Earnings in 2006 will be influenced by a combination of higher rates, energy prices and perhaps even lower demand. The market is not excited with stocks right now.