Wall Street is Confident Again
Wall Street had an amazing run on Tuesday. Stock rose tremendously after a long struggle in trading
stemming from the long-term sub-prime mortgage crisis. Investor confidence seems to be coming back.
The Dow Jones escalated an incredible 391.47 points, which is 3.2%. The S&P 500 jumped a high 7.5%, or 47.48 points. The Nasdaq composite index climbed 83.65 points, which is 3.7%. Even the Russell 2000 index saw gains of 3.3%, or 22.68 points. These increases cover much of the declines experienced earlier this year and for the past several months.
The question that remains at this point is whether or not the high performance will last. The markets have done well before, but sometimes it is short lived. Will investor confidence hold out for the rest of this quarter? What about the rest of the year?
It is possible that Wall Street believes that the bank losses that stemmed from the housing market are coming to an end. Investors might be acting on the good faith that the housing crisis has done all of the serious damage that it will do, and the worst is over. It would be nice if they are right, and the economy is poised for a turn around.
Aside from that, manufacturing did not do as poorly as expected during March. This gave some hope that the economy will begin to change for the better.
At the end of this week, the unemployment data will be released. If the numbers don’t look promising there, we might see a little less confidence on Wall Street.
Overseas, European markets saw a high performance as well. Major indexes in Europe gained an average of 2.9%.
Hopefully, investors will not have to see too many more sharp declines. The future economic data will determine whether or not things are really looking up for the economy. Hopefully some more positive data will encourage Wall Street and maintain their confidence in the markets. We will have to wait and see what happens. Things could go either way at this point.
