So much for the Black Friday Bounce: Worries about the credit market and economy are erasing nearly every bit of it on Monday.I've even more convinced I don't understand finance. Over to someone who does.
The Dow Jones Industrial Average was recently down 159.16, or 1.2%, to 12821.72. The decline wiped out the bulk of a 181-point rally on Friday. The Nasdaq was off 41.68, or 1.6%, to 2554.92. The S&P 500 fell 23.65, or 1.6%, to 1417.05.
Last week, stocks fell sharply in the days before Thanksgiving, but surged on the Friday after. It seems that brief bounce -- discounted by many because it came on very low volume -- had no staying power after all.
As has often been the case lately, the drag on the markets Monday came from the financial sector. The most troubling news was that HSBC plans to take onto its balance sheet structured investment vehicles struggling to raise money in the capital markets.
But there were also worries about the health of Citigroup, Fannie Mae, Freddie Mac, E*Trade Financial and more, all tied to the worsening credit crunch.
"People are nervous," said Todd Leone, head of listed trading at Cowen & Co. "Until the financials bounce back the market's not going to be in a great place."
Monday, November 26, 2007
Maxed-Out-Mama Was Right?
According to the Wall Street Journal :