Wall Street Bounces Today
Yesterday, the U.S. stock market plunged in a rather dramatic fashion. Dropping more than 250 points, the Dow showed great agitation. This bear market correction — putting an end to days of bear market rally — caused some to think that more problems are in the future. Today, though, the stock market bounced. As closing approaches, the Dow is up more than 115 points from yesterday, and it appears as though cautious optimism about the economy has returned.
Part of the success for the stock market today is probably due to financial sector stocks. Both Bank of America and Citi are thriving today, up substantially, and leading the entire stock market. One of the main reasons is that Tim Geithner spoke on the economy and the banking system, providing some hope for investors that things are stabilizing. It also helps that some major financial institutions are talking about how they are ready to pay back TARP funds. With their profits, they are claiming to be well-capitalized and wealthy enough that they don’t need to rely on government bailout money. It’s a nice thought for everyone involved.
Another group probably helping the stock market today: bargain hunters. Bargain hunters are out in force, looking for the deals amongst yesterday’s wreckage. And the stock market hasn’t even managed to fully recover from yesterday, with the Dow only regaining about half the points it lost. But it’s a start. And means that there are still plenty of bargains to pick up tomorrow.
Disclaimer: I am not an investment professional. Nothing in this piece or on this Web site should be construed as investment advice. Before making investment decisions, do your own research and/or consult with an investment professional. All investment comes with the risk of loss. You are responsible for your own investment decisions and any loss that may result from your decisions.
April 21st, 2009 at 7:12 pm
[…] as risk aversion sent traders looking for a safe haven. Today, the story has changed. With the stock market on the rebound and Treasury secretary Timothy Geithner sounding optimistic, risk aversion is making an […]