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Stocks End Rough Week With Modest Drop - Friday 18th January 2008

Sat, 01/19/2008 - 10:33 — Arthur Cristian
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Stocks End Rough Week With Modest Drop
Friday January 18, 6:10 pm ET
By Tim Paradis, AP Business Writer

Stocks Cap Rough Week With Relatively Modest Decline As Stimulus Plan Draws Little Reaction

NEW YORK (AP) -- Wall Street ended a painful week with another decline Friday as skittish investors unable to hold on to much optimism about the economy drew little comfort from President Bush's stimulus plan.

The day's trading reflected how fractious Wall Street has been in the new year. Investors pulled back from a big early advance, with the major indexes trading mixed as Bush began to speak. By the time the president finished announcing a plan for about $145 billion worth of tax relief, the indexes were well into negative territory.

"It's disappointed in the size of the economic growth package. Wall Street's showing its displeasure," said Kim Caughey, equity research analyst at Fort Pitt Capital Group in Pittsburgh. "Honestly, I t hink the institutional investors understand the limits to the government's ability to enact economic change."

Coming after Bush's announcement, Friday's pullback made it clear that the stock market is in for a protracted period of uncertainty and continued declines. Investors have shrugged off all the positive signs they've received in recent days, including assurances last week from Federal Reserve Chairman Ben Bernanke that the Fed is ready to act aggressively -- which means a likely big interest rate cut later this month -- to help support an economy pummeled by devastation in the housing and credit markets.

Steven Goldman, chief market strategist at Weeden & Co., contends Wall Street remains concerned about whether other economic troubles are lurking.

"It's a culmination of factors that have been in existence for a while -- it's the unknown," he said.

That uncertainty made for a turbulent week on Wall Street. While it began optimistically, with the Dow Jones industrials surging 172 points on hopes that perhaps the worst of the housing and mortgage crisis might be over, deepening pessimism led to a 277-point plunge Tuesday and a 307-point slide on Thursday.

For the week, the Dow and the Nasdaq composite index lost 4 percent, while the Standard & Poor's 500 gave up 5.4 percent. In the 13 trading sessions of 2008, the Dow has lost nearly 9 percent, while the S&P has fallen 9.75 percent and the Nasdaq nearly 12 percent.

The market will likely need a long string of upbeat economic and corporate reports before it can regain its footing -- and with the economy clearly weak right now, it is likely to be a while before that kind of data becomes available.

On Friday, the Dow, which was up more than 180 points early in the session, fell 59.91, or 0.49 percent, to 12,099.30.

The broader S&P 500 index fell 8.06, or 0.60 percent, to 1,325.19, while the technology-focused Nasdaq dropped 6.88, or 0.29 percent, to 2,340.02.

Declining issues outnumbered advancers by about 2 to 1 on the New York Stock Exchange, where consolidated volume came to 5.84 billion shares, compared with 5.41 billion shares traded Thursday.

The week's sell-off left the Dow and the S&P 500 well below their October highs -- which had the Dow at a record trading high of 14,198.09. The Dow has fallen more than 2,000 points, or 14.6 percent, while the S&P 500 is down nearly 240 points, or 15.3 percent.

Disappointment with Bush's plan came as investors were searching for those companies that might be weathering the economic slowdown well.

Some are indeed doing better than expected -- like International Business Machines Corp., which told Wall Street late Thursday to raise its 2008 profit estimates for the tech company, and General Electric Co., which posted a fourth-quarter profit rise Friday.

But many others are struggling. Washington Mutual Inc. reported a steep loss late Thursday for the fourth quarter, as Citigroup Inc. and Merrill Lynch did earlier in the week. With the banking industry trying to fix its shrinking portfolios and preparing for more distress in consumer debt, the economy may only have the government to fall back on -- and Wall Street didn't hear as much as it wanted from Bush.

In addition, many investors have been hoping that the Federal Reserve would put in place an intra-meeting rate cut before the central bank's next monetary policy meeting Jan. 29-30. "The market is saying to the Fed: we want a rate cut and we want it now. The fact that it is not getting a rate cut is causing a lot of selling that is feeding on itself," said Peter Cardillo, chief market economist at Avalon Partners.

Government bond prices slipped. The yield on the benchmark 10-year Treasury note, which moves opposite its price, was unchanged at 3.63 percent.

On Thursday, a dismal reading on the Philadelphia Fed's manufacturing index and ratings agency downgrades of bond insurers sent the market tumbling. On Friday, a Bank of America Corp. analyst cut its ratings on three bond insurers -- MBIA Inc., Ambac Financial Group and Security Capital Assurance Ltd. -- to "neutral" from "buy."

MBIA fell 67 cents, or 7 percent, to $8.55 after a sharp drop Thursday.

Ambac rebounded from Thursday's drop, though, rising 34 cents, or 5.5 percent, to $6.58. The company said Friday it will ditch its previous plan to raise $1 billion in capital, a decision many investors considered an ill-advised move to maintain its ratings.

Security Capital Assurance fell 17 cents, or 9.3 percent, to $1.65.

A better-than-expected reading on consumer sentiment came as a pleasant surprise to investors Friday, but ultimately did not help Wall Street save its early advance. The University of Michigan's index, which most economists expected show a decline for mid-January , rose instead. Though not a perfect predictor of consumer spending, the report gave Wall Street some hope that Americans' buying might not drop off too precipitously amid worries about a recession.

The dollar rose against most major currencies.

Crude oil futures rose 44 cents to settle at $90.57 a barrel on the New York Mercantile Exchange.

The Russell 2000 index of smaller companies fell 7.39, or 1.09 percent, to 673.18.

Meanwhile, chip maker Advanced Micro Devices Inc. late Thursday said its fourth-quarter net loss widened, but the loss was smaller than Wall Street predicted. AMD surged 73 cents, or 11.5 percent, to $7.07.

IBM rose $2.30, or 2.3 percent, to $103.40 on its strong forecast.

Washington Mutual rose $1.09, or 8.8 percent, to $13.55. Many investors, in anticipation of an even bigger fourth-quarter loss, had driven the savings and loan's stock sharply lower Thursday.

In overseas trade, Japan's Nikkei stock index rose 0.56 percent and Hong Kong's Hang Seng index advanced 0.35 percent. In Europe, London's FTSE 100 finished down 0.01 percent, Frankfurt's DAX fell 1.34 percent and Paris' CAC fell 1.25 percent.

The Dow Jones industrial average ended the week down 507.00, or 4.02 percent, at 12,099.30. The Standard & Poor's 500 index finished down 75.83, or 5.41 percent, at 1,325.19. The Nasdaq composite index ended down 99.92, or 4.10 percent, at 2,340.02.

The Russell 2000 index finished the week down 31.47, or 4.47 percent, at 673.18.

The Dow Jones Wilshire 5000 Composite Index -- a free-float weighted index that measures 5,000 U.S. based companies -- ended Friday at 13,308.45, down 734.09 points, or 5.23 percent, for the week. A year ago, the index was at 14,350.88.

New York Stock Exchange: http://www.nyse.com

Link to this article: http://biz.yahoo.com/ap/080118/wall_street.html

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We have been accused of being anti - Jewish because we had posted an excerpt from James von Brun's book: Kill the Best Gentiles! http://loveforlife.com.au/node/6054 in which he blames Jews for the problems of the world. Obviously this is not our view because of what we have stated above. We do not hate anyone, whatever religion they follow. We are always open to talk to any religious leader or politician and meet with any judge, member of the Bar, experts, academics, educators etc to share the remedy we offer that heals all the divisions between MAN and MAN, and MAN and the EARTH.

Today, a representative of the New South Wales Jewish Board of Deputies is threatening to close the website down, because they have decided it is anti - Jewish and that we promote racism. What has the New South Wales Jewish Board of Deputies done to end the suffering in the world? Can they show that they are concerned with the suffering of ALL men, women and children AND ARE SEEN TO BE DOING SOMETHING ABOUT IT or are they only concerned with Jewish affairs? If so, they, along with all the other religions that only care for their own, are part of the problem, not part of the solution. The man who rang Arthur today was only concerned with Jewish affairs; he was not interested in our intentions or in anybody else, just as most Christians, Muslims, Sikhs, Catholics, etc, are only interested in their own. While we separate ourselves into groups, dividing ourselves from others with rules, regulations, rituals, procedures and conditions, we will never solve our problems.

No matter what we in the Western World Civilisation of Commerce have been promised by our politicians, religious leaders, scientists, educators, philosophers, etc, for the past two hundred years, all we have seen is ever-increasing destruction of men, women and children and the earth. None of the so-called experts and leaders we have been taught to rely on are coming up with a solution and none of them are taking full-responsibility for the fact that they can't handle the problem. All religious books talk about end times full of destruction and suffering but why do we have to follow this program when there is an alternative to hatred, mayhem and death? Why are our leaders following the program of destruction and death rather than exploring the alternatives? It seems that any mainstream politician, priest or academic are only interested in supporting the RULES OF THE DIVIDE, that maintain the haves and the have nots. For 200+ years, 99% of the world population have been so trained to pass on their responsibility for themselves, others and the earth, that the 1% of the population that make up the leaders of the rest of us are making all the decisions leading to the destruction of all of us and the earth. Let's not forget the education system that brainwashes the 99% of the population that we are free and have equal rights while, in fact, we are feathering the nests of those at the top.

At the root of all our problems is self-centredness, an unwillingness nurtured by the Establishment that keeps us concerned only with our own needs rather than the needs of others around us and the Earth. Instead of creating and releasing acts of love for those around us as gifts to benefit them and the earth, we take, take and take, until there is nothing left. The whole point of the Love for Life website is to show people the root of all our problems and to share the remedy. The extensive research library is there to attract browsers and to provide access to information not available through mainstream channels. If the New South Wales Jewish Board of Deputies can, after careful examination of our work, prove that anything we are saying is wrong, we will be happy to accept their proof. If they cannot, and they are still insistent on closing the website down, they will be showing themselves to be traitors to MAN because they are not interested in pursuing any avenue that can end the suffering in the world.

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Arthur and Fiona Cristian
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17th June 2009