Stocks Plunge, Double Dip Recession Fears Grow After Home Sales Report

[Watchman]

Stocks Plunge, Double Dip Recession Fears
Grow After Home Sales Report

Michael P. Regan
Bloomberg
Tuesday, August 24, 2010

http://www.bloomberg.com/news/2010-...ally-as-home-sale-data-point-to-slowdown.html


U.S. stocks extended losses, sending the Dow Jones Industrial Average below 10,000, and the 10-year Treasury yield fell below 2.5 percent for the first time since 2009 as a bigger-than-estimated slump in existing home sales fueled concern the economy may relapse into recession.

The Standard & Poor’s 500 Index slumped 1.9 percent to 1,047.49 at 10:01 a.m. in New York. The Dow Jones Industrial Average plunged 174.98 points, or 1.7 percent, to 9,999.43.

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Stocks Plunge, Double Dip Recession Fears Grow After Home Sales Report 140410banner4

Purchases of existing homes plunged 27.2 percent to a 3.83 million annual rate, figures from the National Association of Realtors showed today in Washington. The pace compares with the median forecast of a 4.65 million rate, according to a Bloomberg News survey.

The S&P 500 fell 12 percent from its 2010 high on April 23 through yesterday, as reports on U.S. jobs and manufacturing pointed to a slowdown and the Federal Reserve said a recovery may take longer than expected. The decline has pushed the gauge’s valuation to 14 times its companies’ reported earnings, the lowest level in about six weeks.

http://www.bloomberg.com/news/2010-...ally-as-home-sale-data-point-to-slowdown.html

 

[moolightaffairs]

bro, in charting point of view, recent rallies or regaining of index are a rebound actions of the previous crash. it will go down again and hopefully not as low as previous crash! all these rallies are just knee jerk reactions of the crash and all these gains are not fundamentally sound.

 

[denzuko1]

bro, in charting point of view, recent rallies or regaining of index are a rebound actions of the previous crash. it will go down again and hopefully not as low as previous crash! all these rallies are just knee jerk reactions of the crash and all these gains are not fundamentally sound.

I agree with you. This is very similar to what happened during 1998. A rally during the beginning of 1998 till about May-June that year, it then started a second plunge.

The probable reason for much sustainability is due to a much larger sum of money being injected into the market, causing a longer period of distribution.