Following a very nice rally, stocks have sold off somewhat, although we're still well in bull market territory for the day. This is a very typical reaction to Chairman Bernanke's remarks. As the impact of the Fed Chairman's remarks fade, markets often reverse in the opposite direction. As the new week brings a fading memory to the markets next week, don't be surprised if worry begins once again to wear down the bullish sentiment. I also wouldn't be surprised if, over the weekend, we see more developments in the attempt to backstop Freddie Mac and Fannie Mae, which may give the market more impetus next week. And don't be surprised also, if we see more bank failures over the weekend. The FDIC tends to announce them after market close on Friday to prevent overnight panics.Friday, August 22, 2008
Well, Maybe We're Not THAT Convinced!
Following a very nice rally, stocks have sold off somewhat, although we're still well in bull market territory for the day. This is a very typical reaction to Chairman Bernanke's remarks. As the impact of the Fed Chairman's remarks fade, markets often reverse in the opposite direction. As the new week brings a fading memory to the markets next week, don't be surprised if worry begins once again to wear down the bullish sentiment. I also wouldn't be surprised if, over the weekend, we see more developments in the attempt to backstop Freddie Mac and Fannie Mae, which may give the market more impetus next week. And don't be surprised also, if we see more bank failures over the weekend. The FDIC tends to announce them after market close on Friday to prevent overnight panics.
