Weak economic data weighs on US Market
US Market ended lower today, Thursday, 28 February and The Dow Jones Industrial Average slipped by triple digits. Weak economic data weighed on market sentiment for entire day as Federal Reserve Chairman, Ben Bernanke continued to answer questions for the second consecutive day at Capitol Hill today. Financials were hard hit today after Bernanke said before the Senate Banking Committee that smaller U.S banks might fail. Eight out of the ten sectors ended in loss today. Energy and Telecom were the only winners.
The Dow Jones industrial Average ended the day with a loss of 112 points at 12,582. The Nasdaq Composite Index, finished lower by 22 points at 2,331. S&P 500 finished lower by 12 points at 1,368. Twenty-five out of thirty Dow stocks ended in the red today led by AIG. Verizon and AT&T were a couple of noted Dow winners.
In economic news, The Commerce Department reported today that the U.S. economy grew at an unrevised 0.6% annual rate for the fourth quarter. And for all of 2007, the economy grew at the weakest pace in five years.
Also reported in the morning was that new unemployment claims for the week ended 23 February rose to 373,000 from 354,000. The consensus estimate called for a reading of 350,000.
Commodity prices hit all time high today as dollar just continued to plunge against its major counterparts. In the currency market today, the dollar fell on interest rate outlook. Federal Reserve Chairman had hinted yesterday that Fed will go for further softer landing in the coming days and might reduce interest rate by another fifty bps in its next meeting.
The U.S. dollar tumbled to record lows against the euro after lackluster economic data and Federal Reserve Chairman Ben Bernanke's comments raised fears about the U.S. economy. The trade-weighted dollar index, which measures the greenback against a basket of six major currencies, fell 1.2% to 73.68.
Crude prices rose by almost $3 today after the dollar fell to new lows against most of its counterparts, mainly the euro. Crude-oil futures for light sweet crude for April delivery today closed at $102.59/barrel (higher by $2.95/barrel or 3%) on the New York Mercantile Exchange. Prices are 66% higher than a year ago. Reports of production disruption at Nigeria also pushed up crude prices today.
Volume on the New York Stock Exchange topped 1.4 billion, and declining shares outran those advancing more than 2 to 1, while almost 930 million shares were exchanged on the Nasdaq, with advancing issues ahead of those declining, also more than 2 to 1.
Tomorrow there are economic reports on the dock. Personal Income and Outlays for January are expected first. The Chicago National Association of Purchasing Managers February reading is due shortly after opening bell followed by the University of Michigan's Consumer Sentiment Survey.
0 comments:
Post a Comment