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- Jobs Market Continues to Sway Investors - 3 may 2012
- Wall Street Indexes, Auto Industry, Housing Market at Year End - 29 December 2011
- Stocks Rally on Fed's Resolve to Aid Economic Recovery - 3 November 2011
- Europe Resolution Boosts Investor Confidence - 27 October 2011
- Proposed Eurozone Bailout Impacts Wall Street - 13 October 2011
- FOMC Meeting Highlight of Week Ahead - 19 September 2011
- European Debt Crisis Impacts Wall Street - 12 September 2011
Indications of a Wall Street rally at the beginning of May were short-lived as investors reacted negatively to troubling jobs reports in both the United States and Europe, despite a few encouraging signs relating to the US economy. Following the announcement by payroll processing company ADP that the US created fewer jobs in April when compared to March (119,000 and 201,000 respectively), the Dow Jones industrial average dropped by 87 points before ending the day at 13,268.57 points, being down 10.75 points. This was a sharp turnaround from the previous day when US manufacturing reports lifted the Dow to close at its highest point in over four years. The S&P 500 fell 3.51 points, closing at 1,402.31, while the Nasdaq ended the day up 9.41 points at 3,059.85
As 2011 draws to a close, Europe's debt problems remain in the spotlight for anxious Wall Street investors, resulting in stocks being down by more than one percent at close of business Wednesday. Trading volumes have been light in this last week of the year, and with few economic and corporate reports due it is doubtful that this light trading trend will change until the New Year. Analysts have noted that recent market movement is likely to have been influenced by investors taking stock of their investment portfolios and taking action to balance these in preparation for 2012.
The first two days of the week saw Wall Street markets declining significantly, with a noteworthy recovery occurring on Wednesday afternoon. The latest policy statement from the Federal Reserve, backed up by positive remarks from Fed Chairman Ben Bernanke, indicate a commitment from authorities to continue to assist the US economy in its recovery efforts. The Dow Jones industrial average climbed by 178 points, with the S&P 500 rising by 20 points, and the Nasdaq composite surging 33 points, being 1.5 percent, 1.6 percent and 1.3 percent respectively.
Tuesday saw a sharp drop in US stocks ahead of the EU summit to be held the following day. By Wednesday afternoon investors began gaining confidence that European authorities would agree upon a workable solution to Eurozone woes. Following an uneasy day on Wall Street, all major indexes ended the trading day higher with the S&P 500 moving up 13 points, the Dow Jones industrial average adding 162 points, and the Nasdaq composite climbing 12 points, being 1 percent, 1.4 percent and 0.5 percent respectively. Although details of the plan to bring Europe's debt crisis under control, and to assist its banking sector, still need clarification and fleshing out, the very fact that an agreement has been reached on how to move forward was enough to boost investor confidence to a degree.
Stocks rose sharply on Wednesday before dropping slightly, but still ending the day at an encouraging high, with the rally believed to have been fuelled by optimism regarding the latest proposal to recapitalize banks in Europe. Investor sentiment appears to have shifted from its doom-and-gloom outlook last week, to one of hope that a TARP-styled rescue plan will be put in place for European banks. President of the European Commission, Jose Manuel Barroso was reported as stating Wednesday that the resolution of this ongoing crisis needs immediate action from policymakers. He also pointed out that banks that fail to meet capital requirements should not be permitted to pay out dividends and bonuses.
Recent developments on Wall Street included increased initial purchase offer activity with LinkedIn becoming the first tech company since Google to file an IPO. A follow-up analysis of current IPOs by analytics company, Dealogic, noted that 146 companies have filed with regulators waiting for approval to sell shares in the United States in an effort to raise $28.4 billion. However, it has also been revealed that 215 companies have either withdrawn or postponed IPOs to the value of $44.1 billion – going down in US stock market history as being the highest year-to-date figure since 2008, and the highest figure for September in twenty years or more. Social network games maker, Zynga, and online coupon company, Groupon, are among companies delaying the IPOs which investors were anticipating would take place after Labor Day weekend earlier this month, with market volatility playing a part in this decision.
Rumors that Greece is likely to default on its enormous debt caused ripples of apprehension around the financial world, resulting in investors selling off stocks, and US markets dropping sharply on Friday. Speculation is rife that the country may very well not get the next installment of bailout funds allocated by the European Union, the European Central Bank and the International Monetary Fund – at least until the so-called troika is assured that austerity measures in Greece are going to achieve what they have set out to do, reduce the government’s debt. All seventeen nations using the euro as currency – the Eurozone – need to approve of further bailout funds being issued to Greece. While all eyes are on Greece at present, Portugal, Ireland, Spain and Italy are also struggling, and analysts have expressed doubts that the European Financial Stability Facility (EFSF) will be able to pull all these ailing economies through the current financial crisis.
- Video: Sarah Quinlan on European Debt Crisis, Outlook
- Tuesday 22 May 2012, 8:39 am - Video: Pimco's Clarida on Global Economy, Greece
- Tuesday 22 May 2012, 8:15 am - Video: CDU's Fuchs on Level of Euro, Contagion Risks
- Tuesday 22 May 2012, 8:03 am - Video: Europe Banks Shunned in Franklin's Stocks Portfolio
- Tuesday 22 May 2012, 7:53 am - Video: Scholnick Focused on Facebook's Long-Term Value
- Tuesday 22 May 2012, 7:48 am - Video: AlixPartners's Crawford on Global Economy, Strategy
- Tuesday 22 May 2012, 7:43 am
- Jobs Market Continues to Sway Investors
- Thursday 3 may 2012 - Features - July 2014 Compliance for Volcker Rule
- Friday 20 April 2012 - Markets - JOBS Act - Easing Regulations for Growth
- Thursday 5 April 2012 - News - FHFA to Bulk-Sell Foreclosed Homes
- Thursday 22 March 2012 - News - High Frequency Trading
- Thursday 8 March 2012 - Features - Stock Exchange Listing and Delisting
- Thursday 23 February 2012 - Features


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