Big sell off on Wall Street
2008-06-18 15:04:53 (GMT) (Caymanmama.com - Business News)Wall Street (CaymanMama.com) — On Tuesday, due to poor growth rate amidst the higher price pressure, the stocks price saw a sharp fall due without any relief in the prices of oil prices for third day while Goldman Sachs showed better earnings. Amidst all these things, the industrial averages for Dow Jones lost 0.9% while both NASDAQ composite and Standard and Poor’s 500 showed a loss of 0.7%.
The price for crude oil in US was $134.01 per barrel. However, the long term projections show that the prices of oil will increase and this adds to the worries of economy that is struggling with inflation. However, according to the economic reports that were released on Tuesday said that there is a higher rise in prices during the month of May as a part of PPI (Producer Price Index) while a decline in industrial production.
According to Dave Rovelli, MD at US based Canaccord Adams, an equity trading group said, “The PPI minus food and energy was fine, but including it, it was very inflationary and the industrial production report shows you we’re not growing.” He also added that the economic reports were leading to confusion about Federal Reserve about its lifting of interest rate. On Wednesday, one will get to know about the earning reports from FedEx, Morgan Stanley. Rovelli added, “Hopefully if Morgan is decent tomorrow, that could help.”
Later in the day, government also released its crude oil report. However, analysts at Platts (an energy based research firm) feel that the stockpiles for oil have declined around 2 million barrels. In the last month, the prices of oil and gas have reached record levels and it had been a strong factor to decide the fate of stock market.
According to PPI, wholesale inflation has increased by 1.4% and the price of energy and food has increased by 1%.
CaymanMama.com - Press Release Distribution Service
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