It Zigs, It Zags: U.S. Market Rises 4% After a Down Day By FLOYD NORRIS and CHRISTINE HAUSER

Continuing the wild swings from panicked selling to fevered buying and back, stocks soared on Thursday, leaving investors bewildered about what might come next. 

In a display of wild volatility, the American stock market this week has produced alternating days of collapsing prices — accompanied by speculation of a renewed financial crisis that could be even worse than the one that began in 2008 — and sharply rising prices amid reassurances that banks are healthy and corporate profits strong.

On Thursday, the Standard & Poor’s 500-stock index soared 51.88 points, or 4.6 percent to 1,172.64. Traders pointed to a small decline in claims for unemployment insurance in the United States and to reassurances from French officials that their country’s banks were safe.

That gain recovered all of a 4.4 percent decline on Wednesday. For the two days, the index was up 0.11 points, or one one-hundredth of 1 percent. On Monday, the market had fallen by 6.7 percent, only to leap by 4.7 percent on Tuesday. So far this week, the index is down by 2.2 percent.

“It is a very, very tense, emotional and momentum-driven market right now,” said Eric Thorne, an investment adviser at Bryn Mawr Trust, a Pennsylvania bank. The apparent motto, he added, is “shoot first, ask questions later.”

Never before in the history of the S.& P. index, which goes back to 1928, had there been alternating gains and losses of more than 4 percent on four days. In most years, there were no such days at all.

There were only two previous times since the Great Depression when the S.& P. 500 moved at least 4 percent in four consecutive trading sessions. The first came in October 1987, when the market crashed, and the second occurred in November 2008, as the financial crisis intensified. But neither of those saw alternating gains and losses. In each of those cases, the pattern was two declines, then two gains.

http://www.nytimes.com/2011/08/12/business/daily-stock-market-activity.html?_r=1&hp=&pagewanted=print

 

Market turmoil clouds resilient profit results

from the SMH
Despite volatile swings, the sharemarket actually rose over the week in a period highlighted by better than expected earnings reports from several major companies.

Analysts say the wild movements in share prices are likely to continue due to factors far removed from Australia’s economy.

These include investor concerns over the level of European sovereign debt and the looming prospect of a double-dip recession in the United States.

‘‘While we’ve seen a lot of volatility and a lot of big movements, the overall effect has been relatively modest,’’ Westpac chief economist Bill Evans said.

The All Ordinaries index added 1.6 per cent this week, after falling 7.4 per cent and 3.7 per cent in each of the two preceding weeks.

After the fallout from the downgrading of US sovereign debt by ratings agency Standard & Poor’s and fears of spreading debt woes in Europe, the local market began to move on factors closer to home.

There were good profit reports from the likes of Telstra, National Australia Bank, Commonwealth Bank and even retailer JB Hi-Fi.


Read more: http://www.smh.com.au/business/market-turmoil-clouds-resilient-profit-results-20110812-1iqk1.html#ixzz1UniQNjIE

The Australian share market is gaining from a reduction of volatility on global financial markets at the end of last week.

The widely watched Chicago VIX, which is a measure of financial market volatility, fell from 48 around the start of last week to about 36.5 on Friday.

It is still elevated from more normal levels around or below 20, but well down on its financial crisis peak above 80.

So-called 'risk' assets have benefitted from the relative calm, with the major miners leading the Australian share market higher.

BHP Billiton has surged 3.9 per cent to $39.69, while Rio Tinto was also up a strong 3 per cent to $73.66 by 11:31am (AEST).

http://www.abc.net.au/news/2011-08-15/share-market-rises-as-fears-abate/2839772

 

Meanwhile at the gas pump...

Economists at CommSec say motorists should try to take advantage of cheap petrol this week before the price starts to edge higher.

Figures from the Australian Institute of Petroleum show the national average price slipped by 1.4 cents last week $1.40 a litre.

CommSec expects prices to ease by another 1 or 2 cents this week.

However, CommSec economist Savanth Sebastian says the global oil price is on the way up, and petrol prices are likely to follow.

"The uncertainty on a global front has taken a backwards step, we are returning to a period of norm and calm that's seen the oil price start to rise once again, and more fundamental factors will decide the fate of petrol prices going forward," he told ABC News.

http://www.abc.net.au/news/2011-08-15/petrol-prices-to-rise/2840214

European and US shares have seen more large falls, as the uncertainty that has caused recent turmoil returns.

London's FTSE 100 index ended the day down 4.5%, while Germany's Dax lost 5.8%. Shares failed to recover in US trading, with the Dow ending 3.7% down.

Shares in some leading banks plummeted, with Barclays and Royal Bank of Scotland down more than 11%.

Analysts again cited reasons including worries about global growth and the eurozone debt crisis.

"People are nervous about the outlook for the global economy," Grant Lewis, head of economic research at Daiwa Capital Markets in London, told the BBC.

http://www.bbc.co.uk/news/business-14574125

see toon at top...

Market Swings Are Becoming New Standard

By LOUISE STORY and GRAHAM BOWLEY

The stock market just can’t seem to make up its mind.

Day after day, stocks swing sharply by hundreds of points. Last week they tumbled 3 percent in the first 90 minutes of trading on Tuesday morning, then on Wednesday closed nearly 3 percent higher and dropped almost 3 percent on Friday. All of this on the heels of unusual back-to-back 4 percent leaps and dives in one week in August.

Now traders head into the week with fresh worries about the chances that Greece will default on its debt and the havoc that would wreak on European banks.

All of this anxiety has caused experts to ask whether there are new forces at work in the stock market that make trading permanently more erratic. 

In fact, big price moves are more common than they used to be. 

It has become more likely for stock prices to make large swings — on the order of 3 percent or 4 percent — than it has been in any other time in recent stock market history, according to an analysis by The New York Times of price changes in the Standard & Poor’s 500-stock market index since 1962.

Some experts see volatility as a problem because it can scare investors away from the markets, make companies reluctant to go public and undermine confidence in the economy, causing further drops in shares.   

But another viewpoint is that stocks are rightly volatile now because there is so much uncertainty about where the economy is heading — and canny investors could profit from the big swings, or simply sit them out until the market eventually finds equilibrium. 

“It’s neither good nor bad,” said Michael Schmanske, head of United States index volatility trading at Barclays Capital. “It is a measure of  high opportunity but also peril.” 

So what’s causing the rise in the big bounces? 

It’s hard to know for sure, but market analysts point to new types of souped-up computerized trading and extraordinary global economic turmoil — from protests over a second bailout for Greece to the downgrade of United States debt.

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Krugman Says BRIC Really BIC

 

Trichet: Son, we live in a world that has prices, and those prices have to be guarded by men with bonds. Who’s gonna do it? You? You, Sylvia Wadhwa? I have a greater responsibility than you could possibly fathom. You weep for Lehman Brothers, and you curse Ben Bernanke. You have that luxury. You have the luxury of not knowing what I know.

http://krugman.blogs.nytimes.com/2011/09/11/the-truth-europe-cant-handle-the-truth/

 

"Russia really doesn't belong in the group. It's a petro-economy in terms of world trade," Krugman said late last week in Yaroslavl. "There are a lot of people and a lot of technical skills and at least potentially Russia could be a part, but its role in the world right now is not at all similar to China."

Oil and gas account for 17 percent of Russia's gross domestic product — versus less than 10 percent of Brazil's — and contribute about 40 percent to state revenue. Russia's sovereign credit rating was last raised by Moody's Investors Service in 2008 to the third-lowest investment grade.

Goldman Sachs economist Jim O'Neill coined the BRIC term in 2001 to describe the fast-growing economies of Brazil, Russia, India and China, which he said would collectively match the size of the U.S. by 2020.

South Africa was invited in December to join the group, which held its first summit in 2009 in Russia, followed a year later by a meeting in Brazil.

"There's China and India, which in important ways belong together — labor-abundant rapid-growth economies," said Krugman, who was invited to give a speech at the Global Policy Forum.

"Brazil is a middle-income, not lower-income country, and still more than half of its exports are raw-material oriented. But it does have a strong manufacturing sector," he said. "Russia doesn't fit at all."

Read more: http://www.themoscowtimes.com/business/article/krugman-says-bric-really-bic/443540.html#ixzz1XjYc2hMF
The Moscow Times

The local share market has closed 1.2 per cent higher amid light trade, with investors still wary about developments in Europe after yesterday's steep losses.

Former European Central Bank vice president Lucas Papademos has been named as Greece's new prime minister, tasked with saving the country from default, bankruptcy and an exit from the eurozone.

But the eurozone growth forecast for next year has been slashed from 1.8 per cent to just 0.5 per cent, sparking fears of a double-dip recession.

The benchmark ASX 200 closed at 4,297 and the All Ordinaries Index finished the session at 4,359.

The major mining companies were mostly strong, with Fortescue Metals adding 2.8 per cent to close at $4.82 after dropping more than 8 per cent yesterday.

Rio Tinto ended 0.7 per cent higher at $69.40 and BHP Billiton rose 0.9 per cent to $37.80.

The big banks also rose, with the Commonwealth leading the way up 1.6 per cent $49.59.

http://www.abc.net.au/news/2011-11-11/local-market-close/3661296

 

Can someone tell me how to become a leech?...

 

Morgan Stanley has been roundly panned for the way it dealt with the IPO. The underwriters' job is to assess the value of the company, set the price and sell the shares. But they and Facebook decided to boost the size of the share offer and price days before the IPO, and in doing so, according to Bloomberg, ignored advice from co-managers.

Reuters even reported that Morgan Stanley's own internet analyst, Scott Devitt, reduced his revenue forecasts for the Facebook flotation in the run up to the IPO, after the social network itself expressed caution over its revenue growth. The move shocked the markets and could have damaged the float.

It was also criticised for offering too many shares, and in the end Morgan Stanley was forced to buy Facebook stock on Friday to maintain the price. "The firm's traders bought an estimated 30 million to 40 million shares at $38 that day, hoping to prevent the stock from breaking below the offer price," reported the New York Times.

 

Read more: http://www.theweek.co.uk/us-business/facebook-ipo/47048/knives-out-wall-street-after-facebook-float-train-wreck#ixzz1vfLuSez8

If this is not manipulation of markets, then I am a mug... But that's me... Dummy is my nickname...  

I did not buy any stock in this wonderful float... which of course is about making friends... and spending most of your time counting them... See toon at top...

 

Facebook founder Mark Zuckerberg, the company itself, and the banks leading its flotation are all being sued by disgruntled shareholders.

At least three law firms say they are filing actions against the company and its underwriters in a New York district court amid accusations they hid information from investors ahead of Friday's initial public offering (IPO).

 

They said the IPO documents put out by the company and underwriters "contained untrue statements of material fact" and omitted other crucial information for investors, in violation of securities laws.

The law firms allege Facebook's revised growth figures were not disclosed to all investors before the shares were floated on Friday.

Facebook went public last Friday in the United States' second-largest IPO ever, but the shares plunged 18 per cent in the days after, wiping billions of dollars from the company's $US104 billion valuation.

 

http://www.abc.net.au/news/2012-05-24/facebook-sued-by-disgruntled-shareholders/4029646?WT.svl=news1

 

----------------------------

Come on, fellows... Mugbook is all about making virtual friends... Most likely the valuation was virtual too... May be you should have paid with virtual money... Hey, it's possible you did anyway. These days a lot of cash is virtual...

 

 

 

The anger surrounding the sharp decline in the value of Facebook shares deepened yesterday when investors who have lost millions discovered that its founder apparently saved more than £110m by selling early.

Mark Zuckerberg, the social network's founder, sold shares in the company worth £720m on Friday, the day it floated on New York's Nasdaq stock market. But the price plummeted soon afterwards, from the $38 a share (£23.95) at which Mr Zuckerberg sold his stock. The price difference meant Mr Zuckerberg saved £111m by getting out early.

The shares closed at $32 on Wednesday, 15 per cent below the float price.

Some investors are now suing Facebook and the banks that organised its public listing for not revealing information about the firm's financial health prior to flotation. One of the lawsuits filed in New York by three investors alleges that the company's documents about its initial public offering, or IPO, included various statements that were not true.

http://www.independent.co.uk/news/business/news/mark-zuckerberg-saved-111m-by-selling-facebook-shares-before-stock-slumped-7786269.html

 

Ah, ye old truth in the valuation of ye old stock market... To me the purpose of the "mugbook" share price was to have an IPO above the record breaking magic figure of 100 billion bux... nothing else... Even at three dollars and fifty cents, the shares would be too dear. But I have no concept of the value of money...

See toon at top...

 

JUST days after its sharemarket debut received a lukewarm response, Facebook is facing another challenge - how to deal with a hungry taxman.The company, along with the likes of Google, will find itself in the cross-hairs of the Australian Tax Office keen to find out what tax it is liable to pay on the estimated $55 million revenue from its Australian offshoot.
New laws introduced to Parliament last week aim to stop the practice of global companies reducing their tax liability by shifting their revenues and profits around different territories.

Read more: http://www.smh.com.au/technology/technology-news/taxman-makes-tech-companies-face-the-music-20120526-1zbpx.html#ixzz1w3FCXQNE

 

The Australian share market has surged ahead in early trade, with the Australian dollar also up around 2 US cents.

In the first half hour of trade, the benchmark All Ordinaries index had gained 1.2 per cent to 4,743, and the ASX 200 was up 61 points to 4,757.

More than three-quarters of the top 200 companies had gained ground in early trade, with most of the blue chip stocks trading higher.

Investors are moving into stocks linked with local and global economic growth, with resources firms leading the gains, followed by industrial companies, banks and retailers.

The two major miners recorded strong gains, with BHP Billiton up 2.1 per cent to $32.78 and Rio Tinto up 3.3 per cent to $53.28.

http://www.abc.net.au/news/2013-06-14/shares-dollar-jump-on-strong-overseas-leads/4753824

If you have not realised yet, the glum of the stock market can last only this long... The glum is part of the way some people will make money... Say you sell when the glum is on by fear of a massive dump and the next day you realise you dropped a couple of millions because some clever dick bought your shares and resold them with a tidy profit... Ugly... Yoyo it is... It's a game of cat and mouse between mugs and con artists...

Meanwhile unemployment in Australia has dropped slightly from 5.6 to 5.5 per cent... 

And despite an ENORMOUS lead in the "polls", the coalition is very worried, despite their mates in business trying to sabotage the economy by placing their foot on the brakes TO BE LIFTED AFTER THE ELECTION...

The coalition is worried Julia might pull it off, because from August, when she gives the keys of the lodge to the GG, it's going to be an all major assault on the coalition and a possible victory for Labor... So until then, the media is pushing for Julia to go and go and go... Hold your nerves, Mr Shorten: Rudd would spoil the game.

 

See toon at top

 

The Australian share market rallied today, posting its biggest jump in 17 months as investors snapped up oversold shares.
The benchmark S&P/ASX200 index jumped 96 points, or 2 per cent, to 4791.8, closing within a whisker of the day’s high. The broader All Ordinaries rose 90.6 points, or 1.9 per cent, to 4775.5.
Today's rally added roughly $30 billion to the market's value. Over the week, which saw plenty of mood swings, the market managed to rise more than 1 per cent.

Read more: http://www.smh.com.au/business/markets/shackles-released--stocks-jump-20130614-2o7r7.html#ixzz2WB3pjppl