Friday’s Market Recap (11/07/2008)
Posted on: November 7, 2008 - Email Article - Printable Version
The market finishes the week higher after the worst two-day decline since the 1987 stock market crash. The Dow Jones Industrial Average increased 248 points, or 2.85% for the day, and 3.4% for the week. Similarly, the S&P rose 2.86%, and the Nasdaq moved 2.41% in the green. Investors must have felt the after-election fall wasn’t completely justified, as signaled by today’s increase. Either that, or the 14-year high unemployment rate was taken with more than a grain of salt by Wall Street. The White House continued to preach patience, and stated that the $700 billion bailout plan will take some time to make a noticeable impact.
Jobless Claims this month reached the levels seen in March 1994 of 6.5%. A total of 1.2 million jobs have evaporated this year, though the market hit another dead-end in October with the Dow dropping over 14% on the month, conditions might still worsen as companies continue to release earnings and announce job cuts like Ford has done today. Ford [F: 13.39, +0.05 (+0.37%)] announced earlier today that they will cut roughly 2,200 jobs or 10% of salaried workers in North America. This news comes after Ford missed earnings by $0.37, and lost $1.31 per share this past quarter.
European markets proceeded higher Friday despite Germany experiencing the largest drop in industrial production in 13 years this past September, which fell 3.6%. The DAX moved up 2.49%, while the FTSE climbed 2.59%, and the CAC 40, 2.42%. The dollar is trading around the opening price of 0.7838 euros.
The Nikkei continued to drop 3.55% during the market hours on the day after Toyota Motors [TM: 77.09, +0.10 (+0.13%)] lowered their forecast of future profits. Following up on the potential merger of Panasonic [PC: 14.605, -0.325 (-2.18%)], and Sanyo that I mentioned earlier on in the week, both boards of directors met today and announced that they will be seeking a deal with their shareholders to continue the merger process. The Hang Seng made gains of 3.29% on the day, while Taiwan’s Straits Times climbed 2.43%.
Oil proceeded marginally higher on Friday after getting slaughtered yesterday. Crude jumped 0.23% today, trading slightly below $61 at $60.91. Oil traders must not believe recent highs in the unemployment rate are too alarming, nor believe that it will mean a tremendous drop in demand. Traders are considering the global drop in production and factory orders in the past few months, which directly relates to a drop in factories’ demands for oil. Gold only gained $1.50 on the day, and is trading around $732.70.
Microsoft [MSFT: 29.16, -0.11 (-0.38%)] has formally announced that they will not make a renewed bid for Yahoo [YHOO: 16.4784, +0.1584 (+0.97%)] after Yahoo dodging bids for several months. CNBC.com’s analyst Jim Goldman believes that, although Microsoft has no interest for a 100% claim in Yahoo, he believes that Microsoft is still extremely interested in purchasing its search engine service. Keep alert for such a confirmation or denial.
That’s all for today, catch me Monday, 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 MSFT.
The Following Stocks Were Mentioned In This Article: F, MSFT, PC, TM, YHOO
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