Wall Street braces for more bad news, eyes bottom
Sunday, 1 March 2009
NEW YORK, Feb 28 (AFP): Deep in the red for the first two months of 2009, Wall Street enters March with frayed nerves in anticipation of more weak data as investors look for any signs of an end to the horrific economic slump.
With some indexes at 12-year lows, the market remains cautious about the economic outlook, despite reassuring comments in the past week from Federal Reserve chairman Ben Bernanke suggesting the worst crisis in decades could ease this year.
The Dow Jones Industrial Average of 20 blue chips slid 4.10 per cent to end Friday at 7,062.93, its lowest level since 1997.
The broad-market Standard & Poor's 500 sank to its lowest close since December 1996, losing 4.50 per cent to 735.09.
The technology-heavy Nasdaq composite fell 4.40 per cent over the week to 1,377.84, near its lows from last November.
With a bear market in full force, the Dow has dropped 19.52 per cent so far this year after a slide of over 11 per cent for February. The S&P is off 18.62 per cent in the year and the Nasdaq down 12.63 per cent.
Al Goldman at Wachovia Securities acknowledged that he was wrong in suggesting the market had established a low point in November but still held out hope for a rebound soon.
Investors had to cope with more grim economic news including a downward revision showing a stunning 6.20 per cent annualised drop in fourth quarter economic activity, highlighting a deepening recession.
A government plan to boost its stake in troubled banking giant Citigroup to as much as 36 per cent through a stock conversion also roiled the market and sparked further debate over whether the move was an effective nationalisation.
Bonds failed to provide the safe haven investors were seeking and ended lower in the week.
The yield on the 10-year US Treasury bond rose to 3.04 per cent from 2.77 per cent a week earlier and that on the 30-year bond increased to 3.72 per cent against 3.57 per cent. Bond yields and prices move in opposite directions.
With some indexes at 12-year lows, the market remains cautious about the economic outlook, despite reassuring comments in the past week from Federal Reserve chairman Ben Bernanke suggesting the worst crisis in decades could ease this year.
The Dow Jones Industrial Average of 20 blue chips slid 4.10 per cent to end Friday at 7,062.93, its lowest level since 1997.
The broad-market Standard & Poor's 500 sank to its lowest close since December 1996, losing 4.50 per cent to 735.09.
The technology-heavy Nasdaq composite fell 4.40 per cent over the week to 1,377.84, near its lows from last November.
With a bear market in full force, the Dow has dropped 19.52 per cent so far this year after a slide of over 11 per cent for February. The S&P is off 18.62 per cent in the year and the Nasdaq down 12.63 per cent.
Al Goldman at Wachovia Securities acknowledged that he was wrong in suggesting the market had established a low point in November but still held out hope for a rebound soon.
Investors had to cope with more grim economic news including a downward revision showing a stunning 6.20 per cent annualised drop in fourth quarter economic activity, highlighting a deepening recession.
A government plan to boost its stake in troubled banking giant Citigroup to as much as 36 per cent through a stock conversion also roiled the market and sparked further debate over whether the move was an effective nationalisation.
Bonds failed to provide the safe haven investors were seeking and ended lower in the week.
The yield on the 10-year US Treasury bond rose to 3.04 per cent from 2.77 per cent a week earlier and that on the 30-year bond increased to 3.72 per cent against 3.57 per cent. Bond yields and prices move in opposite directions.