Rally breather but prepare for action next week
by Peter Switzer
A new day and a new worry with Europe out of the frame for a couple of days and now concerns over China have hit market enthusiasm. And there’s anxiety about tomorrow’s jobs report out in the US.
By the way, this is what stock markets do after they go up by something like seven per cent in a week — they look for reasons to take profit. However, there are a lot more investors not as willing to dump stocks now after the collective central bank action we saw yesterday.
This is a part of the market healing process as the pendulum swings from more people wanting to be out of stocks to more people wanting to be in stocks.
The Dow finished 25.65 points, or 0.21 per cent, lower to 12,020.03 while the S&P 500 ended down 2.38 points, or 0.19 per cent, to 1244.58.
There was a little concern over the jobless claims going over the 400,000-mark but there’s an expectation that the jobs numbers on Friday will be good.
What would be great is a better-than-expected unemployment number followed by some solid Europe news early next week. This would add to confidence levels and bed down the current rally.
On China, signs that the factory sector was going backwards — something not seen for around three years — worried investors but this makes sense as Europe is China’s biggest customer. Also the Chinese really know how to stop and start their economy and so a soft patch is likely to be short-lived.
Apart from the jobs report tomorrow, a key meeting in Europe on 9 December will be the next big hurdle for stock markets.
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Published on: Friday, December 02, 2011
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