The Lapsed in August was too weak for U.S. stock indexes retreated with between 4 and 6 per cent. So this August, has become the most negative since 2001. He is also the first August in which the exchange does not take growth for the past five years. Session last month was filled with twists, the indexes several times changed its direction. Ultimately, Dow Jones Industrial Average rose 0.05 percent to 10,015 points, while during the session was sunk to below 10,000 points. For the whole month, Dow Jones fell 4.3 per cent. Index of companies from Nasdaq Stock Exchange lost 0.3 percent to 2,114 points today, the S & P 500 rose 0.04 percent to 1049 points. Both the index in August fell by 6.2 and 4.3 per cent. Today abrupt change and bring significant negative sentiment report from the last Federal Reserve meeting. The reason for negative attitudes given the news that the American economy must “invest significantly” to be contemplated new aid from the Federal Reserve reported Wednesday. The heads of the central bank would consider measures for additional incentives if the economic prospects deteriorate significantly, “said a transcript of the meeting of the Fed held on August 10.
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The enthusiastic investors in gold like to think this way have got everything. According to them the price of precious metals can only be lifted regardless of whether the economy is facing inflation or deflation. Aside from the lack of evidence that investors in gold are now faced with a situation that even though they themselves may not be called positive. Major suppliers of gold such as Goldline placed under a magnifying glass because of misleading customers to buy coins with 35% surcharge on the cost. Sellers of gold convince investors that the worst financial crisis in the U.S. could lead to confiscation of gold from the Federal Reserve, which however does not apply to coins of numismatic value. They give an example during the Great Depression, without specifying, however, then the possession of gold was illegal, but its owners were encouraged to sell voluntarily. So customers are directed to the exotic coins ups by 35% compared with only 5% investment in gold bullion. To lay the fear of confiscation to include stakeholders from media, which have a profitable business with suppliers, which creates concerns about conflict of interest already for months, but the stories of clients who have lost a third of their investment, re-awaken to the problem .
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The U.S. stock indexes sharply changed the direction of movement and despite serious losses at the beginning of the session went green. With a major contribution to this was Goldman Sachs, which until it was the main factor causing the sale. Today’s session ended with a growth of 0.75 percent for the index of blue-chip Dow Jones Industrial Average, which reached 10,230 points. This is a significant upward to the fact that in early trade index slumped to 10,007 points. Objectives included 20 of the 30 companies in the index rose today. The broader S & P index added 1.14 500 percent to 1083 points and the index of companies by the exchange Nasdaq – Nasdaq Composite, rose 1.1 percent to 2222 points. Impulse that trigger positive sentiment was given by Goldman Sachs, which publishes an improved outlook for investment banking business in the sector. It includes good expectations of mergers and acquisitions, leading to positive News. Before this report, notably disappointing report of Goldman Sachs, which was saved from fall in profit 80 percent, was among the causes of stock decline. Shares of IBM fell 2.54 percent with the New York Stock Exchange after profit technology company beat second quarter estimates, but sales disappoint.
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The U.S. Treasury announced that the state has collected 10.5 billion dollars by selling 2.6 billion shares of Citigroup. Shares were owned by the Government as part of a plan to rescue the financial sector worth $ 700 billion made in 2008. Ministry of Finance added that it is selling out of 1.1 billion shares and that it has completed the second phase of the plan to eradicate the government’s stake in the institution, writes AP. Shares were sold at an average price of around 4.03 dollars, which means that the country has achieved 24% yield compared to the cost of 3.25 dollars cash. U.S. still has 5.1 billion shares of Citigroup, which means that soon there may be selling more shares. During the financial crisis, the Bank received 45 billion dollars from the state which is the largest aid granted a U.S. bank. Of the total 25 billion dollars were converted into shares which were owned by the Government.
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Most stock indexes in Asia and Pacific region are brought to negative territory in today’s session, many of them are about to be completed the week with decreases. Economic disappointing data from Asia, Europe and the U.S. in recent days, the forthcoming meeting of leaders of the G-20 this weekend and unexpected decision of China to loosen controls on the exchange rate of its currency have made investors nervous and trade – volatile. Regional MSCI Asia Pacific index suffered its biggest decline in three weeks today, falling by 1.5 percent to 115.37 points. It includes nearly 1000 traded companies from 10 countries in Asia, plus Australia and New Zealand. Within the past five sessions stock measure lost 0.8 percent of its value after last week advanced to 3.4 percent thanks to strong performance of stock markets in Japan and Australia. The same two securities market and registered the biggest loss this week, contributed most to the decrease of the MSCI Asia Pacific. Appreciation of the yen lower the price of the shares of Japanese exporters and the Nikkei 225 slid 2 percent to 9 points at 737.48 in Tokyo Stock Exchange, which is the strongest its decline for the past three weeks. Shares of Toyota fell 2.5 percent, while those of Canon dropped by nearly 5 percent, according to Bloomberg.
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Analysts say if the GDP data in the U.S. disappointed, this is a clear sign that the economy will not be able to save the banks and they will need to write off trillions of dollars of losses. Two feet of closure of the exchange, U.S. indexes continue to fall as Dow Jones Industrial Average lost nearly 1 percent to 10,200 points after the Fed said it saw weakness in the economic reconstruction of the country. “Taking a defensive position for the summer,” said Rob Morgan, Chief Investment Strategist of Fulcrum Securities. Morgan said he prefers shares of companies in the energy and technology sectors. “Although for a while is good to keep the market, I think in the long term the U.S. economy looks pretty good and will overcome the crisis in Europe relatively easily,” he says. If U.S. GDP in the second quarter of the year be less than 1 or 1.5 percent, then the investor is best to move into cash positions, advises David Hefti, executive director of Cornerstone Wealth Management. “If the GDP data disappoint us, this is a clear sign that the economy will not be able to save the banks and they will have to write off the loss of trillions of dollars, which will return us to a new downward spiral and a new cyclical bear market” says Hefti.
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The U.S. shares failed to initiate growth in the first day of the new month after positive data for factory and construction sector turned with less impact on the market to ongoing concerns about the Debt Crisis in Europe and the consequences of oil spills in the Gulf of Mexico. After a negative start to the session came indexes of green in the middle of trade, but then fell again. Dow Jones Industrial Average ended with a decline of 1.1 percent to 10,023 points. Decrease in the S & P 500 stood at 1.7 percent to 1072 points, with the Nasdaq Composite retreated 1.5 percent to 2222 points. Shares of BP continued downward trend in the European session and lost in New York 14.97% of its value. The company said it continues to fail to deal with caused by the oil spill that has already cost her nearly $ 1 billion. Serious losses registered securities and other groups associated with the sector, but also with ecological disaster of April 20. When Anadarko Petroleum decrease amounted to 19.55% in Transocean – of 11.85 percent at Halliburton – of 14.8 percent, and for Cameron International Corp. – Of 11.9 percent. All four companies are involved in the business of BP – the ownership of the oil field, the system for notification of accidents, etc. These companies own and BP have lost nearly 40% of its total market capitalization since the oil platform sank Deepwater Horizon.
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The Global Indexes recorded some increase in recent days, but whether it is sustainable? CNBC offers views of Christopher CEO of Hobart Financial Group and Vernon Taylor, investment director of Biltmore Capital. “I would like to tell you that the storm is over, but I think that this is currently just a dream,” says Hobart. “We see significant volatility in recent weeks and months, and investors should be very cautious.” Hobart sees risk of decline in the Dow Jones between 500 and 1000 points next month if global problems such as debt crisis in Europe and rumors about China’s credit policy have been resolved. At the same time, investors should take advantage of volatility, “says Vernon. “Strategies of options, especially in volatile environments – will be extremely successful.” The analyzers are claiming that the US indexes may have strong decrease in the coming month and this will hurt seriously the US Dollar. According to the analyzers on US market the indexes reached high growth and maybe this was the maximum for this financial situation.
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Increased sales of shares in the final minutes of the session on Wall Street withdrew completely strong increases in indexes of morning trading. Positive wave that swept the securities markets in Asia and Europe today, failed to remain in the U.S. by Dow Jones IA complete a psychological level of 10 thousand points for the first time in three months. Even better than expected sales figures for new homes in U.S. orders for durable goods production could not support indexes. New orders for the production of durable goods recorded a 2.9% increase on a monthly basis in April, which was twice the expected. Meanwhile, sales of new homes in the U.S. rose 15 percent to its highest level in two years. Despite the good economic data index of the 30 largest U.S. stock and liquid companies Dow Jones IA fell 0.7 percent to 9 974.45 points. The broader index S & P 500 has lost 0.6 percent to 1 067.95 points and Nasdaq Exchange main index Nasdaq Composite fell 0.7% to 2 195.88 points. Since the beginning of May and the three U.S. indexes fell by about 10%. Global stock markets were extremely volatile during this month after pessimism gripped investors worries that the massive budget deficit and debt of several countries in Europe may lead to the second stage of the financial crisis.
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The Debt Crisis changes rules of the game, Europe is facing a risk of “W-shaped recession,” said Arnab Das, executive director of market research and strategies Roubini Global Economics. “There are many logic behind the decline in the stock exchanges after indexes powerful climbing in recent months,” says Das. “The arguments in support of” V-shaped “scenario are weak and in Europe there is a real risk of” W-shaped “recession in the U.S. slowdown.” “We see a strong recovery by the beginning of the Debt Crisis in the euro area,” adds Das. “Governments in the euro area are trying to solve the problem, but it seems no success. Now it is unrealistic to say that we get out of this crisis without reaction on the market. China tightens monetary policy, while U.S. consumption is quite low. ” “Those who monitor the market and ask why the stock depreciates, since so many companies are presented so well, can not understand the most important thing,” said Das. “Greece is the tip of the iceberg. The risk of spreading the debt crisis in countries like Spain and even Britain, which has very high levels of debt is already very large. Measures to limit the spending will reduce growth, and this will affect corporate profitability. ” “We need a period of debt reduction,” he added. “Markets should be free of all these debts. We have not yet done so and we will be more bankruptcies.
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