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U.S. stocks tumble; Dow slides below 10,000

Discussion in 'Biashara, Uchumi na Ujasiriamali' started by MziziMkavu, May 26, 2010.

  1. MziziMkavu

    MziziMkavu JF-Expert Member

    May 26, 2010
    Joined: Feb 3, 2009
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    Fears grow about the world economy and tensions between the Koreas

    U.S. stocks hammered following global selloff
    May 25: U.S. stocks tumbled in early trading Tuesday driven by worries about the global economy and tensions between North and South Korea. CNBC's Michelle Caruso-Cabrera reports.
    NEW YORK - The Dow Jones industrials plunged below 10,000 Tuesday after traders dumped stocks on expectations that the world economy will weaken in the coming months. The Dow fell about 200 points in afternoon trading. It has fallen about 1,340 points, or nearly 12 percent, from its recent high of 11,205, reached April 26. The Dow and broader stock indexes all fell about 2 percent.

    Investors also exited the euro and commodities including oil and again sought safety in Treasurys. That drove interest rates lower. The benchmark 10-year note's yield fell to its lowest level since April 2009. Investors were anxious about problems beyond the financial crisis in Europe. Tensions between North and South Korea reminded traders that political issues can be a threat to economic growth. And analysts said that even the still unresolved oil spill in the Gulf of Mexico contributed to investors' foul mood.

    Still, uncertainty over the impact that Europe's debt problems could have on the rest of the world in the coming months remains the biggest driver of investor pessimism, said Jonathan Corpina, president of Meridian Equity Partners. The largest concern is that painful austerity measures that European governments are being forced to take could lead to a prolonged economic slump in the region and cause another global recession. And investors fear that even those measures won't contain the crisis, Corpina said.
    "It seems like the Europeans are playing 'tag, you're it ' — first it was Greece and now it's maybe Spain or Portugal," said Corpina, a New York Stock Exchange floor trader. "We know someone else is next. The problem is that it seems like every plan in place isn't going to satisfy the needs."
    A warning of hard times came from Britain's Queen Elizabeth, who opened the new session of Parliament with a speech delivered on behalf of Britain's new coalition government. The queen, said there would be budget cuts because "the first priority is to reduce the deficit and restore economic growth."
    Other European countries are imposing budget cuts as well, trying to control their debts. Investors are concerned that these steps will stifle economic growth, and that other countries including the U.S. will inevitably see their own growth stunted.

    European Union leaders warned Tuesday that the continent's economy would stagnate unless governments make major reforms to promote growth. The problem is, though, that large debts in some countries make it difficult to implement stimulus measures to rally economies.
    The market's continuing slide, with frequent triple-digit drops in the Dow, recalls the unrelenting selling of the 2008 financial crash. It begs the question, what can halt the plunge?
    Jim Dunigan, managing executive of investments for PNC Wealth Management, said good news about jobs or corporate earnings could stabilize stocks by signaling that a U.S. recovery is intact. The government's monthly jobs report in less than two weeks is expected to show that employers are continuing to ramp up hiring. And companies will soon start giving hints about profits for the quarter that ends in June.
    News moving the markets

    "You could derail growth in Europe and not derail growth in the United States but people don't necessary use a lot of logic when they're headed to the exits," Dunigan said.
    But right now, traders aren't being swayed by upbeat U.S. economic news. They ignored a better-than-expected report on consumer confidence Tuesday. The Conference Board's consumer confidence index rose for the third straight month, climbing to 63.3 in May from 57.7 last month.
    The reason for that is the fact that investors are not focusing on current signs of growth. instead, they are trying to gauge where the global economy will be later this year.
    CONTINUED : 'Walking on eggshells'1 | 2 | Next >

    U.S. stocks tumble before late-day rebound - Eye on the Economy- msnbc.com
  2. Kiranga

    Kiranga JF-Expert Member

    May 26, 2010
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    Cipriani parties kimyaaaa, I think this shyt is tanking into a double dipped recession (don't even think about a lost decade like Japan, which is quite possible) what with the European sovereign debt crisis and Korea about to blow up any minute.

    All them Wall St $ 100,000 + jobs that used to be for the taking are going to be hard as as a mutha, esp for a brotha.
  3. BAK

    BAK JF-Expert Member

    May 26, 2010
    Joined: Feb 11, 2007
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    Kama uliwekeza vijisenti huko hali hii inatisha sana. Na kama kutakuwa na vita ndiyo kabisaaaaaa! zitaporomoka zaidi maana si Marekani wala Europe (NATO) yenye ubavu wa kupigana vita nyingine bila kuongeza kwa kiasi kikubwa sana budget deficit ambazo zitadumu kwa miaka chungu nzima na kuvuruga kabisa uchumi wa dunia.