Weekly Market Update -Feb 1st

The Fed cut rates again this week this time by .50 points, causing the market to show some gains on Thursday and Friday -the Fed seems to be in panic mode. The market has shown a nice rebound so far since the first rate cut on Jan 22nd., breaking the downtrend that started on Dec 26th. Housing stocks showed a nice rebound (that doesn't mean that you buy them!), while the Semiconductor and Financial groups also showed a nice rebound.

Google lost almost $60 per share this week on an earnings disappointment -the stock has lost about $200 per share since December. Meanwhile Microsoft made a $44b takeover bid for Yahoo in hopes of competing against Google, and Exxon reported profits of over $40 billion.

Oil prices dropped below $90 per barrel on Friday on recession fears, while Gold also retreated from it's high of $933 per ounce -looks like these commodities may have topped out for now. The US Dollar is again approaching the lows we saw in late November.

For next week I expect the stock market to continue higher in the short term, with all the easy money being thrown around; the trend in the charts also support this view.


News Stories:
Stock markets end the week on an up note
Dollar Approaches Record Low Against Euro After Fed Rate Cuts
Job losses in January raise recession fears
Home prices falling at record rate in November
Wall St rises on tech bid; best week since March '03
Nasdaq Posts Worst January in Its History
Microsoft launches $46 billion hostile bid for Yahoo
Bond-insurer woes may trigger more write-downs
Banks Join to Rescue Bond Insurer Ambac -- Source
S&P says subprime losses may top $265 billion
Merrill Hit With Fraud Charges
Precious metals continue their record surge
Stocks and Indexes mentioned in this blog are for educational and illustration purposes only.