logo
  Join        Login             Stock Quote

ETF Periscope: Benny And The Greeks

 September 26, 2011 11:38 AM


"Why don't they make the whole plane out of that black box stuff."  –Steven Wright

Ben Bernanke struck out swinging.

Next up: the European Union's heavy hitters. How they handle the curve ball will go a long way toward establishing the market's direction for the upcoming week and, most likely, for the remainder of the year.

On Wednesday, the Federal Reserve Chairman announced that the Fed was effectively lowering long-term consumer borrowing costs. The vehicle for that action was dubbed "Operation Twist," a $400 billion swap of longer-term Treasuries for similar short-term holdings.

Wall Street, which apparently wanted to see a more dynamic level of economic stimulus, was so disappointed that it staged an epic sell-off of equities, one that dropped the Dow Jones Industrial Average (DJIA) by a stunning 600 points over a two-session period and about 700 points on the week.

[Related -Sector Detector: Bold Bulls Dare Meek Bears To Take Another Crack]

The only really good news for the market was that on Friday, the Dow was up 37 points.

On the face of it, that hardly compensated for the 6.4% weekly decline, its worst since October of '08. However, the fact that the market found support for the second day in a row at the same level may prove to be significant. It likely meant that acceptable price points for stocks were finally identified by institutional investors, and it kept the market from plunging below the lows of the year.

Coupled with the fact that Wall Street was heading into a weekend already laced with uncertainty due to upcoming EU debt crisis deliberations, a Friday failure into the close could have really sent investors scurrying for the exits "en masse."

[Related -Sector Detector: Stocks Cruise Right Along, Whistling Past The Graveyard]

Obviously, the Blue Chip index wasn't the only victim of the week. In addition to the Dow being down over 6%, the S&P 500 Index (SPX) was slammed lower by 6.6%, and the Nasdaq (COMP) fell 5.3%.

Also noteworthy, recent commodity darlings gold and silver got seriously hammered on Friday, with gold losing over 5% and silver diving down around15%.

Now that Bernanke has cleared his throat and moved off center stage, the players comprising the EU crisis are again returning to the spotlight.

In spite of systemic monetary problems within a number of EU member nations, primarily the PIIGS (Portugal, Ireland, Italy, Greece and Spain), it appears that investors are capable of being placated by promises of solutions in lieu of the real thing. This was evidenced less than two weeks back when France's Nicolas Sarkozy and Germany's Angela Merkel announced, in tandem, their solidarity in maintaining the EU and the single currency.

However, voices of a less optimistic tenor emerged last week, contributing to the market's dive.


Next Page >>12
iOnTheMarket Premium
Advertisement

Advertisement


Comments Closed


rss feed

Latest Stories

article imageHealth Net, Inc. (HNT): Potential to Be Huge Winners Says Bank of America

As of this keystroke, Health Net, Inc. (NYSE: HNT) shares are up around 4% on the day. The managed health read on...

article imageHomeAway, Inc. (AWAY) Q2 Earnings Preview: Top and Bottom Line Bullish Surprise?

HomeAway, Inc. (NASDAQ:AWAY) will report its financial results for the second quarter ended June 30, 2014 read on...

article imageAmazon.com, Inc. (AMZN) Q2 Earnings Preview: Missing on the Top and Bottom Lines, Again?

Amazon.com, Inc. (NASDAQ:AMZN) will release its second quarter financial results after market close on read on...

article imageFord Motor Company (F) Q2 Earnings Preview: Light on the Top Line?

Ford Motor Company (NYSE:F) will release its preliminary second quarter 2014 results at 6:30 a.m. EDT read on...

Advertisement
Popular Articles

Advertisement
Daily Sector Scan
Partner Center



Fundamental data is provided by Zacks Investment Research, and Commentary, news and Press Releases provided by YellowBrix and Quotemedia.
All information provided "as is" for informational purposes only, not intended for trading purposes or advice. iStockAnalyst.com is not an investment adviser and does not provide, endorse or review any information or data contained herein.
The blog articles are opinions by respective blogger. By using this site you are agreeing to terms and conditions posted on respective bloggers' website.
The postings/comments on the site may or may not be from reliable sources. Neither iStockAnalyst nor any of its independent providers is liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. You are solely responsible for the investment decisions made by you and the consequences resulting therefrom. By accessing the iStockAnalyst.com site, you agree not to redistribute the information found therein.
The sector scan is based on 15-30 minutes delayed data. The Pattern scan is based on EOD data.