Stock Markets Close Flat in View of Jobless Claims
The stock markets remained strong on Friday in view of the troubled world economy and slightly damped as news came trickling about a positive job scenario. As a result the markets closed on a flatter note.
The market experienced a climb as the U.S. government reported that jobless claims were decreasing. DJIA climbed as high as 83 points, putting aside all the widening trade deficits of the U.S., the downgrade of Spain and the unemployment issue that plague Greece. However, the rally faltered later in the noon and Dow Jones began dilly-dallying between paltry gains and modest losses. It saw the end of the day a little lower than it began. The situation was persistent even with the Nasdaq composite index. The Standard & Poor’s 500 however ended the day with a miniscule gain.
The traders seemed to be so accustomed to the ongoing woes that yesterday’s developments hardly had any effect on them. In fact, the deputy chief investment officer of the Wells Fargo Private Bank in San Francisco, Erik Davidson commented that there was nothing that could move the market yesterday. The analysts bickered on saying that the stocks are relatively cheaper. It seems most likely that the central banks are going to take some more steps to try and do something about the dwindling economy.
The Dow Jones Industrial Average closed slightly lower at 13,326.39 from 13,344.97. Standard & Poor’s 500 gained slightly at 1,432.84 from 1,432.56 and the NASDAQ fell to 3,049.41 from 3051.78.
Profits slowing down around the world
The U.S. Labour Department declared that the weekly unemployment aid applications had dropped and are the lowest since the February of 2008. The unemployment rate before the financial turmoil was at 4.9% as opposed to today’s 7.8%.
The report sure did show some positive signs but there is still a long way to go before recovering completely from the current financial crisis. The unemployment report was the only news that brought about a few cheers. The world economy on the other hand is slipped, registering lower profits.
Earlier this week Alcoa heralded a disappointing start to the Q3 earning season. Yesterday, Safeway added to the woes as the grocery store also reported a low profit margin. The Safeway shares fell since then by 3%.
Yesterday also saw a report from the U.S. Commerce Department, which had some more bad news. The report said that American-made vehicles and farm goods have seen a decline in demand in the foreign markets. Germany was also in the fray as separate economic studies predicted that German growth would further slow down. They also signalled that the composure was diminishing with regards to bailing out weaker European nations.
The situation in Greece, one among the European nations that are currently surviving on bailouts, met with some more troublesome news, with the unemployment percentage increasing to an astronomical 25 percent. Earlier the S&P 500 had downgraded Spain severely to the lowest level possible. Overall the situation in Europe is showing no signs of improvement at all and it is likely to continue in the same manner for quite a while.
The IMF and the World Bank held a meeting yesterday in Tokyo where Christine Lagarde, the IMF chief admitted that the global financial recovery is weaker than expected. She also stressed the urgent need to solve the debt problems plaguing Europe for some time now.
In the midst of all the bad news, a few stocks managed to leap a few points as reports came in about new takeovers, purchases and potential owners. Reports came in yesterday that a Japanese cell phone company Softbank is likely to buy Sprint Nextel. Sprint Nextel then ended its day by rising more than 14% to $5.76. Oshkosh Corp. also soared about 7% to $28.90 after Carl Icahn offered to buy the truck company.
Binary options strategies for the day
Overall there was not much activity in the market yesterday. It was just one of those reasonable days where nothing special happens. Europe was slipping as always. There was nothing significant to report from the Asian market as well. The commodity market was abuzz with all the new regulations and swaps moving towards futures. The stocks however had a lazy day.
The stock market does not seem to come out of a bearish grip. The only thing that you could probably do is bank your binary options in favour of a bearish outcome. The stock market is only witnessing small waves; there are no big tides in favour of either a bullish or a bearish outcome. There are hardly any stocks that seem to be doing their own over a consistent period of time. Make sure you diversify your options so as to negate any losses due to small gains that were common yesterday.