Stock Market Shows Strength
February 27 scared a lot of investors and made bulls out of bears. The bears are trying to win this war of wills that has been going on since Black Tuesday. Their job was easy at first because of the dearth of actual information on why the market took a big drop. Alan Greenspan’s comments in China, the Chinese market drop, housing stock default and more were blamed for the downturn in the equity market last week, but in reality it stemed mainly from a computer glitch that occured for about 2-3 minutes that prevented some large trades from being executed. This problem quickly snowballed into a panic because traders and investors did not know what was happening.
Those that “short” stocks, have tried to continue the panic so they can capitalize off it. However, as more information is revealed and the stock market shows more strength their scare tactics are playing on more and more deaf ears. However, they might be able to continue this as more earning reports come out and they claim the sky is falling. Next week will be telling to see how the Street reacts to all this information–if it can stabalize this might be the end of the sell-off. if not, then there might be more opportunities to buy stocks at a deep discount.
Written by Nagel on March 10th, 2007 with
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