US stocks cap rough week

The day's trading reflected how fractious Wall Street has been in the new year.

By AP
January 20, 2008 08:31
3 minute read.

SHARES WALL STREET Stocks ended a painful week with another decline Friday as skittish investors unable to hold on to much optimism about the economy drew little comfort from President George W. Bush's stimulus plan. The Dow, which was up more than 180 points early in the session, fell 59.91, or 0.49 percent, to 12,099.30. The broader S&P 500 index fell 8.06, or 0.60%, to 1,325.19, while the technology-focused Nasdaq dropped 6.88, or 0.29%, to 2,340.02. The day's trading reflected how fractious Wall Street has been in the new year. Investors pulled back from a big early advance, with the major indexes trading mixed as Bush began to speak. By the time the US president finished announcing a plan for about $145 billion worth of tax relief, the indexes were well into negative territory. Coming after Bush's announcement, Friday's pullback made it clear that the stock market is in for a protracted period of uncertainty and continued declines. Investors have shrugged off all the positive signs they've received in recent days, including assurances last week from Federal Reserve Chairman Ben Bernanke that the Fed is ready to act aggressively - which means a likely big interest rate cut later this month - to support an economy pummeled by devastation in the housing and credit markets. That uncertainty made for a turbulent week on Wall Street. While it began optimistically, with the Dow Jones industrials surging 172 points on hopes that perhaps the worst of the housing and mortgage crisis might be over, deepening pessimism led to a 277-point plunge Tuesday and a 307-point slide on Thursday. For the week, the Dow and the Nasdaq composite index lost 4%, while the Standard & Poor's 500 gave up 5.4%. In the 13 trading sessions of 2008, the Dow has lost nearly 9%, while the S&P has fallen 9.75% and the Nasdaq nearly 12%. EUROPE London's FTSE 100 finished down 0.01% at 5,901.70, Frankfurt's DAX fell 1.34% to 7,314.17 and Paris' CAC fell 1.25% to 5,092.40. ASIA Major markets recovered from what had been an early plunge. In Tokyo, the region's biggest market, the benchmark Nikkei 225 stock index rose 0.56% to 13,861.29, reversing an opening 3% plunge in the wake of an overnight drop on Wall Street. Hong Kong's blue chip Hang Seng index rose 0.35% to 25,210.87 after falling as much as 3.9% in morning trade. CURRENCY The dollar rose against the euro and the pound but fell against the yen and Swiss franc Friday amid news Washington supports an economic stimulus package to avert recession. In late New York trading, the euro fell to $1.4622 from $1.4673 Thursday. The pound, meanwhile, slipped to $1.9681 from $1.9713, dragged down by disappointing retail sales data in the United Kingdom. The dollar fell to 106.67 Japanese yen from 107.00 yen and 1.0990 Swiss francs from 1.1003 Swiss francs. The major focus in currency markets continues to rest on interest rates. The US economic woes have prompted Wall Street to clamor for additional Federal Reserve interest rate cuts, even after the US central bank has cut rates three times in recent months to 4.25%, and signaled more may come. In contrast, the European Central Bank has kept open the option of raising its rates - currently at 4% - to curb the threat of rising inflation. In other New York trading, the dollar fell to 1.0282 Canadian dollars from 1.0299 Canadian dollars. COMMODITIES Gold prices swung almost $50 this week, rocketing to an all-time high of $916.10 Tuesday and plunging to $870.60 Friday ahead of Bush's remarks. Later, an ounce of gold for February delivery climbed $1.20 to settle at $881.70 on the New York Mercantile Exchange. March silver rose 20.5 cents to end at $16.215 an ounce, while copper climbed 5.25 cents to $3.2345 a pound. Word of the US stimulus plan boosted the dollar Friday, weighing some on commodities prices. A higher dollar can make commodities less attractive as an alternative investment, and can also dampen demand from foreign buyers as their currencies weaken. The euro fell to $1.4621 against the dollar in late afternoon trading. Oil futures rose as energy investors held out hope for the stimulus plan. Light, sweet crude for February delivery climbed 44 cents to settle at $90.57 a barrel on the New York Mercantile Exchange. Agricultural futures settled mostly lower on the Chicago Board of Trade. Wheat for March delivery jumped 22 cents to settle at $9.625 a bushel and March corn dropped 3.75 cents to $4.9825 a bushel. March oats lost 2.5 cents to $3.195 a bushel, while March soybeans fell 7 cents to end at $12.64 a bushel.


Related Content

The Teva Pharmaceutical Industries
April 30, 2015
Teva doubles down on Mylan, despite rejection

By GLOBES, NIV ELIS