Thrusday’s Market Recap (2/26/2009)
Today’s market was flooded with the news that President Barack Obama believes that this years budget deficit will total an astounding $1.75 trillion, which is four times last years budget. He has now proposed to Congress a tax hike on upper income citizens to begin the process towards guaranteed health care for all. In total, the Dow Jones Industrial Average fell -1.22% to a close of 7,182.08 while the Nasdaq and S&P fell -2.38% and -1.58% respectively to closes of 1,391.47 and 752.83. Crude oil fell on the day a minuscule -0.60 to a close of 44.62 while gold boosted 4.70 to close at 947.30.In equity news, Dell Inc.’s (DELL: 8.21, -0.15 (-1.79%)) quarterly profit fell by nearly half as the computer maker said it expects demand for equipment to remain weak in coming months, underlining how deeply the recession is now depleting technology companies. The personal computer maker, which is struggling to turn itself around in this economy, said it would also raise its’ cost-cutting target that they announced last year by another $1 billion, to a total of $4 billion by 2011.
Furthermore, General Motors Corp. (GM: 2.38, -0.17 (-6.67%)) capped a dismal 2008 with a $9.6 billion net loss in the fourth quarter as a stunning downturn throughout global operations heightened management’s concerns about the auto maker’s long term viability. GM went through $6.2 billion in cash during the last three months of 2008, and $19 billion over the course of the year, as sales declines outpaced the company’s ability to cut costs.
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