The stock market is like some punch drunk boxer who gets up after being knocked out only to be pounded yet again.
After rebounding for a milisecond, the Dow Jones industrial average ended the day below 13,000, down 170. The same investors who thought earlier in the day that the world wasn't going to end apparently have changed their minds yet again.
Remember that flicker of optimism earlier thiis afternoon.
Hester Capital Management's Craig Hester told Bloomberg News that, "The market to us looks very oversold and I think it's beginning to create some value in stocks."
Apparently, he wasn't alone.
Investors gobbled up shares of financial companies including Citigroup Inc. (NYSE: C), Goldman Sachs Group Inc. (NYSE: GS) and Merrill Lynch & Co. (NYSE: MER) that had been beaten to a pulp over the past few days. Even Bear Stearns Cos. (NYSE: BSC), which had been especially hard hit, rose for a while. Of course, they all fell by the close of trading.
The tech-heavy NASDAQ Composite Index did well for a while but eventually fell as well. Microsoft Corp. (NASDAQ: MSFT), Oracle Corp. (NASDAQ: ORCL) and Dell Inc. (NASDAQ: DELL) were among the decliners.
The news wasn't all bad.
Consumer prices rose the smallest amount in eight months because of declining gasoline prices, while core inflation held at 0.2 percent, according to the Associated Press.
But the housing market continues to stink. Existing home sales fell in 41 states and home prices fell in one-third of metropolitan areas surveyed by the National Association of Realtors, which says the housing slump is the worst in 16 years. NAR Senior Economist Lawrence Yun is optimistic things will improve. "Recent mortgage disruptions will hold back sales temporarily, but the fundamental momentum clearly suggests stabilizing price trends in many local markets," he said.
This fragile optimism won't last.
Why do we have a weak dollar?
Holiday hiring slow for retailers
Closing Bell: What sell-off? (AIG, ABK, EPR, MBI, JAVA, ORCL, ERTS)
Reader Comments (Page 1 of 1)
8-16-2007 @ 5:28PM
info said...
I think now is a great time to start investing if you have some cash on the side. Not all of it, but start putting chucks of cash into strong beaten up companies.
http://www.marketflavor.com/blog/