Will equities be stable as economic health and the US Dollar drift downwards?
*The Economist, May 17, 2006:
Jittery markets
Markets wobbled this week, as traders worried about America's economic
health and the dollar continued to drift downwards
"THE American economy is in a nervous state, and the news seems to have
trickled through to investors. The Fed statement accompanying last
week’s rate hike was more equivocal than investors wanted about the
possibility of a June pause in its 16-month rate-raising streak. That
rattled markets. The Dow Jones Industrial Average, which had been
inching closer to its record high of 11,723, began to slide back down
again. On Wednesday, after new data on consumer and producer-price
inflation came in higher than expected, the Dow Jones dropped more than
200 points to close at 11,205. The anxiety has spread to markets on the
other side of the Atlantic, with London's FTSE 100, Germany's DAX and
France's CAC 40 all losing roughly 3% of their value on Wednesday alone.
Commodity markets have also shown recent signs of nerves. They have
been soaring in recent months, thanks to the strength of the global
economy and, many believe, speculative money from institutional
investors. The sharply rising price of inputs such as copper, oil and
zinc has been a big part of the inflation worries that are now pressing
on equity markets."
*This information is solely a highlight of the opinion of a third-party publication and is incomplete. Please subscribe to this publication for the full and timely opinion of the author and call a Monex Account Representative for any additional up-to-date information. This is not an offer to buy or sell precious metals. Investors should obtain advice based on their own individual circumstances and understand the risk before making any investment decision.
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