Excerpt from: Bonds and Interest Rates CFDs and Spread Bets
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| January 22, 2008 | | US Markets Re-Open After the Holiday Weekend | Our current calls for the open of the US markets are as follows: DOW Down 574 points at 11525 (4.7%) S&P 500 Down 70 points at 1255 (5.2%) NASDAQ 100 Down 99 points at 1745 (5.3%) After being closed for the long holiday weekend, US indices are heading for carnage on the open. There are all sorts of rumours flying around, particularly surrounding the likelihood of the Federal Reserve cutting rates today, ahead of the scheduled meeting next week, or even of coordinated action between the US, UK and European central banks. Any such action will depend on the severity of losses we see in the US today. Although the Fed would be at pains to say that the markets do not lead interest rate policy, should we see losses today or over the next few days in US stocks of 8 to 10 per cent, it could be argued that the financial system may suffer systemic damage if immediate action were not taken. The Fed would not want this at a time when the US economy is already heading for a possible recession. | | |
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