Today the markets turned to the downside for the first time since last week after Federal Reserve Chairman Ben Bernanke warned that the economy is still not looking as good as it seems. Bank loses due to the sub-prime concerns are still haunting the markets and will continue to bring the market down near term. Bernanke stated that credit loses will spread beyond the financials into other sectors of the market. I feel that we are a long way from being out of the water for now especially being that there will be more write-downs in the banking sector before the market turns around.
As for now the Dow, Nasdaq and the S&P 500 have been on the downside for past 15 weeks and will continue to turn down for the next 5 to 9 weeks before the market turns around and the Dow gets back to it’s multi year high at 14,198.10. Until then the bulls will remain in the caves hibernating waiting for the bears to take their places.
For the week the Nasdaq is up +27.69 or +1.20 percent ending the day at 2,332.54, the Dow is +194.85 or 1.60 percent ending the day at 12,376.98, and the S&P 500 is up +17.57 or 1.32% ending the day at 1,348.86.
By: Marlin Rolle