On the week, the Dow Industrials average was down about 7.5 percent and the NASDAQ down almost 11 percent, in part because traders “sold the rally,” resulting in a down day on Friday despite the passage (and signing) of a $700 billion bailout package by the House and President Bush.
The bill’s approval was cheered on the trading floor but it doesn’t signal the all clear for the market. That was apparent in the last half hour of trading as the hoopla quickly dissolved into a frenzy of selling activity.
NASDAQ was pulled down by bizarre trading on Apple’s stock, which saw huge losses after CNN gave legs to a rumor circulated that Steve Jobs, CEO of Apple, had experienced a heart attack. The rumor was denied, but it capped a bad week for Apple, which has also been downgraded by analysts who feel that Apple can’t possible continue growing its sales of premium-priced Macintosh computers with consumer confidence so low.
Commentators aren’t sure what to expect on Monday, given that the bailout bill has passed but now must be implemented, while unemployment and other indicators could be a drag on the markets going into the next week, as commentators creep closer to the realized that the global economy could be headed for a deep recession:
Goldman Sachs economists Friday said they see a deeper than expected U.S. recession because of poor economic data and the sharp deterioration in financial conditions. They see declining GDP in the fourth quarter and first quarter, 2009 and an unemployment rate of 8 percent by the end of 2009. Unemployment is currently 6.1 percent.
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The Mississippi Free Press produced this story through the MFP Solutions Lab, supported by the Solutions Journalism Network. This series digs into Mississippi’s systemic issues and sheds light on responses to them in other communities. Beyond just reporting on problems, these stories interrogate their causes and inspect potential solutions.