Tuesday, August 14, 2007
Easy Come Easy Go!
Gains evaporated in the last hour of trading as volatility continues to be the norm. The Dow ended the session at 13,236.53 down 3.01 points. The SPX was virtually flat, falling just 0.72 points to 1,452.92.
Stocks started the day to the upside with hopes that the recent interventions by the world’s central banks would ease the problematic credit markets. Overnight, the European Central Bank injected another $65 billion with the Bank of Japan adding $5 billion. The ECB also stated that the credit markets seem to be normalizing. Even so, this wasn’t enough to keep stocks positive on the session.
Another positive for Monday was the better than expected reading in the retail sales report for July. Sales rose 0.3 percent, a tenth more than expected. The hope is that despite a sharp fall off in housing that consumers will continue to spend. However, the Fed doesn’t want spending to become too robust, which could increase inflation pressures. The fact is that traders are now looking for the Fed to lower the Fed funds target rate inter-meeting, so any news pointing to stronger inflation will probably be viewed bearishly by traders.
Until next time.
Stocks started the day to the upside with hopes that the recent interventions by the world’s central banks would ease the problematic credit markets. Overnight, the European Central Bank injected another $65 billion with the Bank of Japan adding $5 billion. The ECB also stated that the credit markets seem to be normalizing. Even so, this wasn’t enough to keep stocks positive on the session.
Another positive for Monday was the better than expected reading in the retail sales report for July. Sales rose 0.3 percent, a tenth more than expected. The hope is that despite a sharp fall off in housing that consumers will continue to spend. However, the Fed doesn’t want spending to become too robust, which could increase inflation pressures. The fact is that traders are now looking for the Fed to lower the Fed funds target rate inter-meeting, so any news pointing to stronger inflation will probably be viewed bearishly by traders.
Until next time.
# posted by Paul @ 3:32 AM 
