Posts Tagged ‘Stock Market’

Stock market appears set to gain ground this year

March 9 marked the end of a 17-month drop for the Dow Jones Industrial Average and the Standard & Poor’s 500, though the Dow closed at 6,547 and the S&P at 676. Since then, the Dow has surged 61% and the S&P 68%, and both appear set for a rally. JPMorgan Chase equity strategist Thomas Lee said the stock market’s stalemate is expected to be “resolved to the upside.”

Hedge funds under investigation for driving down the value of the euro

The US Justice Department has launched an investigation into several hedge funds over allegations they have been working together in an attempt to lower the value of the euro.

People close to the matter told the Wall Street Journal that the department has sent a letter to several funds, including well-known names such as Soros Fund Management and Paulson & Co, asking them to keep hold of their records relating to trading on the euro.

SAC Capital Advisers and Greenlight Capital have also received the communication from the Justice Department, it was reported.

Last week, an article by the paper stated that hedge fund members had met up at a so-called “ideas dinner” in which the falling value of the euro was discussed.

Following the meeting, a research note was leaked which summarized the comments made by one SAC portfolio manager who was in attendance.

“The presenter’s way to play this is to short the euro,” said the report of the comments.

“Basically the stock market right now is effectively trading on the euro … it’s one of the most liquid instruments you can trade.”

The unnamed man also predicted that the euro could end up trading at between $0.90 and $1.20 – below its current level of $1.36.

However, insiders told the Wall Street Journal that it may be difficult to prove whether such information sharing constitutes an act of collusion.

“Charges relating to collusion on Wall Street have been a rarity because of the difficulty of proving that firms intentionally sought to act together and acted nefariously,” said the paper.

The inquiry comes during a period in which the euro has fallen ten per cent in value since December.

Earlier this week, an unnamed strategist told the Financial Times that hedge funds were profiting from bets on European banks cutting their exposure to the Greek economy.

Transaction tax could cause volume to plunge, insider says

Thomas Peterffy, CEO at Interactive Brokers Group, said a tax on financial transactions could cause volume on the stock market to drop 90%. “The mother of all creators of havoc on Wall Street is this looming transaction tax,” Peterffy said. “Trading volumes would plunge by about 90%, markets would become illiquid and tens of thousands of people would lose their jobs.”

Coming Soon: Buffett for the Masses

Berkshire’s proposed stock split to purchase Burlington Northern could usher in a new era for the conglomerate—maybe even membership in the S&P 500

On Jan. 20, Berkshire Hathaway (BRKA) shareholders are expected to open up the company’s stock to a far less exclusive crowd of investors, a group who Chairman and Chief Executive Warren Buffett has long warned against.

By splitting Berkshire’s class B shares 50-for-1, the price of the conglomerate’s cheapest class of stock would fall from about $3,247 each to about $65.

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CBOE’s listing plan might presage takeover battle

After resolving an ownership issue, the Chicago Board Options Exchange voted to transform into a shareholder-based company and developed its plan for a stock market listing next year. The move is expected to trigger a takeover battle for the CBOE. NYSE Euronext, IntercontinentalExchange and CME Group are among those expected to woo the CBOE.


Flash-order ban likely for stock exchanges, unclear for options market

Lawmakers and regulators have been scrutinizing flash orders, but a bulk of the concern is with stock exchanges. The Securities and Exchange Commission might move to ban flash orders, but whether it will put similar restrictions on the options market is unclear. A ban on flash orders in the options markets could trigger upheaval, market participants said.


Smoot–Hawley Tariff Act of 1930 & the Great Depression

The Smoot–Hawley Tariff Act of 1930 was an act signed into law on June 17, 1930, that raised U.S. tariffs on over 20,000 imported goods to record levels. The ensuing retaliatory tariffs by U.S. trading partners reduced American exports and imports by more than half and according to some views may have contributed to the severity of the Great Depression.

The stock market topped in 1929 and fell 45 percent in just three months.

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Brawlin’ Bernie: Madoff victorious in first prison fight

Bernie Madoff, after a heated debate with a fellow inmate over whether the stock market has actually bottomed out, reportedly got into his first altercation since being sentenced to 150 years in a Butner, N.C., federal prison.

Inmates who witnessed the fight told The New York Post that Mr.

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Elliott wave: ‘Time to exit’

“The stock market is poised to complete the bear market rally from March,” says technical expert Steven Hochberg in The Elliott Wave Financial Forecast. Here’s his bearish call.


“On April 2, we forecast a rally that would carry the Dow to 9,000-10,000 and the S&P 500 to 1000.

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Robert Prechter’s market assessment

“The stock market has now fulfilled our forecast made in February for a rise to 9,000-10,000,” says Robert Prechter. In The Elliott Wave Theorist, he now sees increasing risk.


“The rally in the S&P since March has been one of the faster ever, rising 50% in five months, and rapidly carrying the S&P to the lower end of our general target zone of 1000-1100.

“At the same time, optimism has finally reached ‘Primary degree’ levels.

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