By Den Somera
Philippine Daily Inquirer
THE OFFICIAL PERIOD OF THE CHInese ghost month is starting this week. It is to begin on my favorite day, Thursday, Aug. 20. Yet, as it enters, it is again coming in cold and unexpected—as usual.
I clearly remember the market was already expecting it at least a month ago and market volume and turnover at the time also started to get low. This convinced observers of this seasonal event to be more cautious for its coming soon.
But unfolding events swept all that away. The overflow of encouraging trading results on Wall Street from its summer rally and other positive leads contributed to lift local trading activity higher and higher until last Friday, when the specter of the Chinese ghost month again came into play.
Coincidentally, stock prices on Wall Street fell sharply as it closed last Friday. This sent the Dow Jones Industrial Index to fall to almost one percent. This also sent the Nasdaq lower by 1.19 percent and the broader market index S&P 500 by almost one percent, too.
US investors obviously became worried about the reported decline in retail sales; consumer spending is an important factor in the US economy. It accounts for two-thirds of all American economic activity. It is that significant that it plays a crucial role in the performance of the US economy to emerge from recession soon.
Market observers, however, interpreted the sharp fall on Wall Street to be just another aberration. The major indices finished well off their lows of the day which they took as a sign that the future prospect of the market is not all that grim. In addition, the light volume that likely skewed stock prices is said to be insignificant with no diminishing effect on the overall outlook of the market.(Read More)
No comments:
Post a Comment