Tuesday’s Market Recap (10/28/2008)
Posted on: October 28, 2008 - Email Article - Printable Version
Markets around the world made steep gains during trading sessions on Tuesday as the volatility seen in this market condition works to the bulls advantage this time around. The Dow jumped close to 900 points with no significant fundamental news releases surfacing today. The market’s only support: the anticipation of an interest rate cut from the previous 1.5%, to 1% in their meeting tomorrow. The S&P raked in 10.79% at the closing bell, while the Nasdaq recorded 9.53% gains.
The Consumer Confidence Report released today should have worked against the market’s reaction, on the basis that the consensus was higher than the actual report. Consumer sentiment for this past month decreased to a staggering 38.0, down from 61.4 in September. Consumer confidence is at its historic low.
While some markets around the world acted with similar volatility, others showed no effect. The Hang Seng recorded its largest increase in a decade, and ended with gains of 14.35%. The Nikkei jumped 6.4%, moving against the recent surge in the dollar versus the yen. The CAC and FTSE posted positive percentage changes, but remained relatively unaffected by volatility, and ended up 1.55%, and 1.92% respectively. The DAX accumulated double-digit increases, and closed up 11.28%.
Crude oil dropped slightly during the market hours today, while the majority of energy stocks posted major gains. A barrel of sweet crude is trading around $62.73, down 0.78%. Gold fell a couple dollars on Tuesday to $739.30, as investors felt better values might be found in equity rather than precious metals.
At one point during Tuesday’s trading, Volkswagen’s [VW: 0.00, N/A (N/A)] market cap surpassed that of Exxon [XOM: 66.80, -0.42 (-0.62%)], after Porsche purchased every available share of Volkswagen. Volkswagen had a market capitalization of approximately $364 billion, topping Exxon’s $343 billion by $21B.
Other news in the auto industry, General Motor’s [GM: 0.75, 0.00 (0.00%)] has officially asked the Treasury for a loan up to $10 billion to aid in a merger with Chrysler. $3B in preferred shares would be issued to the government, and demanding at least an additional $3 billion loan to help pay pension obligations.
Occidental Petroleum [OXY: 81.84, -0.02 (-0.02%)] announced earnings that surpass expectations. Third quarter earnings were recorded at $2.78 per share, compared to $1.58 per share one year ago. Earnings from their oil and gas segments were up $1.7 billion, while the chemicals segment remained relatively unchanged, the midstream segment experienced a decrease in $22 million, or 23%.
That’s all for today, catch me tomorrow, same time, same place, for the Bullish Banker’s Daily Market Recap.
-Derek Stevens
Disclosure: The fund the author is associated with holds a long position in XOM.
The Following Stocks Were Mentioned In This Article: GM, OXY, VW, XOM
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