Monday, March 03, 2008
Back In the Red
Stocks got well and truely battered Friday, leaving the major market indices lower for the month. The Dow fell 315.79 points to close at 12,266.39. The SPX gave up 37.05 points to closing at 1,330.63. We have no play on currently.
Bad earnings news from AIG and Dell didn't help and major problems with the bail out plan for bond insurer Ambac pushed the markets over the edge.
On the economic front the Chicago PMI was released for February and the results continued to point to manufacturing weakness in the region. This business index fell to 44.5 during the month compared with 51.5 in January. Estimates were for the index to come in near 50.0 with a reading below 50.0 a sign of contraction.
At least consumer sentiment didn’t fall further with the University of Michigan consumer sentiment index rose to 70.8 from 69.6 in the mid-month reading. However, the final result is well below the 78.4 reading seen in January. At least inflation expectations eased, down a tenth at 3.6 percent. Of course, economic growth is the biggest worry, but the Fed just can't ignore inflation!
Where to next? No idea....but my guess is down.
Remember there is a Fed meeting on 18th March and the Fed Funds Futures rates is putting it a 95% chance of there being a 0.5% rate cut at the next meeting.
Until next time.
Bad earnings news from AIG and Dell didn't help and major problems with the bail out plan for bond insurer Ambac pushed the markets over the edge.
On the economic front the Chicago PMI was released for February and the results continued to point to manufacturing weakness in the region. This business index fell to 44.5 during the month compared with 51.5 in January. Estimates were for the index to come in near 50.0 with a reading below 50.0 a sign of contraction.
At least consumer sentiment didn’t fall further with the University of Michigan consumer sentiment index rose to 70.8 from 69.6 in the mid-month reading. However, the final result is well below the 78.4 reading seen in January. At least inflation expectations eased, down a tenth at 3.6 percent. Of course, economic growth is the biggest worry, but the Fed just can't ignore inflation!
Where to next? No idea....but my guess is down.
Remember there is a Fed meeting on 18th March and the Fed Funds Futures rates is putting it a 95% chance of there being a 0.5% rate cut at the next meeting.
Until next time.
# posted by Paul @ 4:51 AM 
