The first week of March provided little to be happy about for investors with terrible job news and a still-volatile Wall Street hitting a low not seen since 1997.
“Stocks rose, fell, then clawed their way back to a mixed close after the Labor Department released its February jobs report,” MSNBC.com said in a March 6 story. “But while the market finished well above its lows — the Dow Jones industrials had a modest gain after falling more than 120 points — many market watchers say there’s no reason stocks can’t slide further, even as the major indexes are near 12-year lows.”
Contributing to that downward pressure is that big institutional investors are still sitting on the sidelines, MSNBC.com said, leaving the market to the far more volatile actions of short sellers, who buy stock on borrowed cash and bet for the price to go down.
“The shorts are having a complete field day in this environment,” Kent Engelke, managing director at Capital Securities Management in Glen Allen, Va., told the Web site. “Right now you have everybody so fearful, and these shorts are controlling the market.”
The worst news of the week came with February jobs numbers — worse than analysts expected, but not as bad as some investors had feared, MSNBC.com said.
“Employers cut 651,000 jobs last month, and the unemployment rate jumped to 8.1 percent, MSNBC.com said. The government also revised its December and January job loss figures up to 681,000 and 655,000, respectively.”
The Dow was down 6.2 percent for the week, marking its lowest point since the spring of 1997.
There have been gains in the market, but the overall slide has been too far and too fast for a small rally to make a difference.
“When you get this precipitous of a fall, you are always due for some sort of rally, but a rally will be unsustainable,” Jeff Buetow, senior portfolio manager at Portfolio Management Consultants told MSNBC.com.
This article was submitted by Kathleen O’Connor, a contributing writer for Biz2Credit. Biz2Credit is a small business marketplace that provides entrepreneurs with the latest industry news and financial advice. Send all questions to firstname.lastname@example.org.