US Stock Market Suffers Hit on Greece Economic Fears March 2010

An article by Punit    No Comments

The stock market suffered a hit on March 25 when fears over the economic strength of Greece and the Euro caused the Dow Jones to fall after making some major gains earlier in the day. This comes one day after worries over Portugal’s credit rating, which pushed the Euro down against the dollar.

Concerns over the debt problems of Greece and Portugal caused a big stock market rally to reverse and quickly fall. The European Central Bank announced that stated Europe needed to take responsibility for its financial problems and that caused many concerns for what would be coming for Greece and its economic problems.

This was not good for the Dow Jones. Earlier in the day, the Dow Jones was up by 119 points, but by the end of the day it was only up five points to 10,841. As well, the S&P 500 index was down two points to 1,166, while the NASDAQ was down by one point to 2,397. For the Dow Jones, the day was a bad one with three stocks falling for every two stocks that rose in the 1.1 billion shares that traded on Thursday, which was 100 million more than traded the day before.

Earlier in the day, Best Buy (BBY) and Qualcomm (QCOM) had big forecasts for economic strength that helped get investors more confident in the economy. With increased expectations of the economy, the Dow Jones continued its rise, which saw the index rise 10 of the past 12 days. By the afternoon, the Dow Jones was at 75 points, only slightly down from the 119 earlier in the day. The troubles in Greece and Portugal caused the dollar to ride a bit, which caused many investors to become cautious. In addition, much of the enthusiasm earlier in the day was lost when the Treasury Department bond auction did not get as much demand as was originally thought.
Crude oil prices fell by eight cents to $80.53 per barrel, while gold rose. Best Buy was up $1.73, or 4.2 percent of its value, while Qualcomm rose 5.5 percent, or $2.19. Other indexes did not rise by much either. The Russell 2000 index rose by 5.58 to 689.26, while markets overseas saw only a small gain. The Britain FTSE gained .8 percent, the German DAX rose 1.6 percent, the French CAC-40 rose 1.3 percent and Japan’s Nikkei rose .1 percent.

While the market was doing well earlier in the day thanks to Best Buy and Qualcomm, worries about the European markets caused all that good fortune to disappear within a few hours. This just shows how things can change so quickly within a day on the stock market. We are not out of a recession yet, and today shows that there are still short improvements available for the market. Will March go out ahead or behind? Time will only tell.

Further Reading:
After Effects of Recession on US Economy

Is second recession dip coming in US Economy