Markets continued their bipolar tendencies this past week and actually turned depressive come last Friday as a global sell off occurred as to the troubles with the European Union, and the muted response to President Obama’s job creation program. It didn’t help to have one of Germany’s top representatives with the European Central Bank’s executive board resign over the tactics of the European Central Bank. Plus, a rumor that the country of Greece would default on its debt over this past weekend was just the icing on the cake. All of these events sent both the U.S. and European stocks into a tailspin.
As the wild fluctuations in the equity markets continued, the problems across the pond certainly overshadowed the $447 billion jobs program that President Obama unveiled this past Thursday before a joint session of Congress. The Dow Jones Industrial Average fell 2.7% that following Friday alone, and now has the Dow sitting below the psychologically important 11,000 mark. The Dow’s 4.08% decline in the first three days of September is its fourth worst three-day start going all the back to 1900. For the week, the Dow gave up 248.13 points or 2.21%. Meanwhile the Standard & Poor’s 500 dropped 1.68% on the holiday-shortened week to a level of 1,154.23. The tech-laden Nasdaq fared noticeably better as it only lost 0.5% to the 2,467.99 mark. The smaller-cap stocks as represented by the Russell 2000 didn’t fare much better than the overall market, as it gave up 1.38% on the week and now sits at the 673.96 level.
In closing, look for another week of wild fluctuations as we all contend with the doubts as to Greece’s ability to remain solvent. Over the weekend, there were comments out of the European Union that it is doubtful that the country of Greece can be saved from bankruptcy. Currently officials in the Greek ministry are reviewing scenarios for handling such a situation, which is sure to cause increased volatility for equities around the globe. All we can say from Money Management Services, Inc., is that we’ll be monitoring the situation very closely. In the meantime, take care and please do not hesitate to get a hold of us with any questions or concerns.
Sources: Barron’s, Wall Street Journal, Associated Press, Gorilla Trading, Dow Jones & Company, Briefing.com
Audrea attended the University of Alabama in Tuscaloosa, where she majored in one of the first approved financial planning programs taught at the University level. In 1998 Audrea graduated from The University of Alabama in Tuscaloosa with a Bachelor of Science degree in Family Consumer Sciences & Financial Planning. Audrea has over 19 years of experience as a Financial Advisor with Money Management Services. She holds the designations of AIF® (Accredited Investment Fiduciary), CRPS (Chartered Retirement Plan Specialist) & CES™ (Certified Estate and Trust Specialist). As an advisor, Audrea specialized in comprehensive financial planning, estate tax planning, personal taxation planning, retirement income distribution planning, wealth accumulation, personalized portfolio management, and fiduciary investment management services.