by Jack Lee
Losses for the S&P were 6% on the day and this approached the all time record of 6.04% one day drop. The DOW Industrials shed over 679 points at the close or a net loss of 7.7%. The NASDAQ fared even worse… it lost nearly 9% of its total value today. Despite the somewhat better than expected retail sales on Black Friday, the global economic news was the driving force in today’s turn that ended a technical rally that began on the 24th of Nov.
To put the stock market in some perspective, the NASDAQ has lost roughly half its value in 12 months and the big board has lost about 40% during the same period.
Hardest hit were the financials (-9.5%), then energy (-7.2%) and finally materials (-6.4%).
Meanwhile, a Bloomberg report said, “Domestic automakers were putting the finishing touches on turnaround plans that they will present to Congress in hopes of securing $25 billion in emergency loans to help them survive the current economic crisis. But unlike during their first visit to Washington, top executives from General Motors Corp. , Ford Motor Co. and Chrysler on Tuesday will each hand in separate blueprints for what they are looking to do with the money. After that, Congress will convene for two sessions on Thursday and Friday before a vote is likely held next week that will determine whether the automakers’ pitches hit their marks.”
Ford stock rallied early today, but finally gave way to selling pressure and closed down 5.2%. GM was off almost 12.4% and last traded at $4.59.
“Things are looking quite bleak. Everyone acknowledges that,” said Brian Gendreau, investment strategist at ING Investment Management in New York.
NEWS FLASH: It’s now official, the nation’s economy peaked, and the recession began, in December 2007, the National Bureau of Economic Research announced today. This should come as no surprise to PS readers; you were warned we were headed for serious financial trouble almost a year ago.
PS If was also announced today that American’s have emerged from negative savings and now save about .01 on the dollar. It is recommended we save at least .10 cents on the dollar. Are you?