600 Point Turnaround For Stocks — Financial Stocks Lead
Kurt Brouwer January 23rd, 2008
Another amazing day on Wall Street. The Dow Jones Industrial Average went way down by 300 points or so to start the day and then everything turned around and it finished up by nearly 300 points. The beaten-down and battered financial stocks led the turnaround. I think this came about due in part to the Federal Reserve’s surprise move on Tuesday to cut the Fed Funds rate by 3/4 of a point (see Federal Reserve Cuts Interest Rates Again). But, there was also an announcement of a meeting in New York with insurance regulators and banks designed to bolster the flagging bond insurance firms such as Ambac and MBIA. For the day, the Dow was up 2.50%, the S&P 500 gained 2.14% and NASDAQ was up by 1.05%.
Now, this does not mean that all is well and all the various issues, concerns, fears and doubts are gone (see Stocks Down Again — It’s An Official Correction). It is just a sign that positive news can get the financial markets going again. The key concerns are corporate earnings as well as the economy. Those won’t go away. However, it was a fascinating day on Wall Street and we have not had many of those lately.
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