Is the Rally Over Already?
As if on cue, the Dow turned negative for the first time this week just as FDIC Chairman Sheila Bair, appearing CNBC moments ago, said that "the markets are responding" well to Treasury's nationalization plan for U.S. banks that was announced this morning.
There have been worries all day yesterday and into today that this is not a real rally.
Heading into the 11 a.m. trading hour, the Dow was trading about even, well off its bolt-out-of-the-gates 300-point rally.
The S&P 500 has dipped a toe into negative territory, down less than half of a percent, but the Nasdaq, which has ignored the rally all day, is down more than 2 percent.
Why are tech stocks so bad? Because tech companies, like Apple and Microsoft, depend on consumer spending, which is being squeezed by the ongoing recession. Not to mention the pending gloomy holiday spending season. There could be a lot fewer iPods under Christmas trees this year.
-- Frank Ahrens
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Posted by: Beau James | October 14, 2008 12:05 PM
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