We got a worse than expected monthly 'jobs' number on Friday, Oil topped $106 per barrel, news of more mortgage lenders on the brink of failure (TMA, FMT -ugly charts!), a gloomy outlook from the Fed chairman, and continued concerns about the credit markets all contributed to the selloff this week.
Also the US Dollar continued to sink this week, helping to drive up the price of oil and gold. The 10yr Treasury Note shot up as well (flight to quality?) -I don't expect it to stay there very long!
Next week: I suspect we will see the indexes back at the low of Jan 23rd. With any luck, we will get a bounce up from that level. Many people are looking for a bounce from the financials -XLF is a good Exchange Traded Fund for that sector; so far it has not shown any sign of a rebound though (remember we got a rebound on Jan 22nd, only to give it all back!).
The big picture -where we are now in relation to the 2000 market top:
News stories:
Job losses: Worst in 5 years
OPEC president says U.S. to blame for oil price
Countrywide may face more credit woes
Thornburg says can't meet $610 mln of margin calls
Mortgage market needs $1 trillion, FBR estimates
Record foreclosures in fourth quarter (March 2007)
U.S. home foreclosures at record high last quarter (March 2008!)
HSBC in $17bn credit crisis loss
Citigroup CEO Starts To Shed Bank Branches
Fed boosts auction size in surprise action
New Spasm Jolts Credit Markets
Aversion to Risk Deepens Credit Woes
The World's Billionaires 2008
Stocks and Indexes mentioned in this blog are for educational and illustration purposes only.
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