Skip to comments.Stocks: Worst week of the year, S&P 500 sinks 2%
Posted on 04/13/2012 2:00:51 PM PDT by Signalman
NEW YORK (CNNMoney) -- U.S. stocks stumbled Friday, following a two-day rally, closing lower for a second straight week with worst declines of the year.
The Dow tumbled 1.6%, while the S&P 500 sank 2% and the Nasdaq lost 2.3%.
At the start of the week,stocks were driven sharply lower by the ugly March jobs report and fresh worries about Europe's debt crisis. They rebounded a bit toward the middle of the week, but fell sharply again Friday as a slowdown in China's economy overshadowed a batch of better-than-expected earnings results.
The Dow Jones industrial average (INDU) dropped 137 points, or 1.1%, on Friday, while the S&P 500 (SPX) shed 17 points, or 1.3%, and Nasdaq (COMP) lost 44 points, or 1.5%.
The Chinese economy grew at an annual pace of 8.1% in the first quarter, the country's National Bureau of Statistics said Friday, marking a deceleration from an 8.9% growth rate in the prior quarter.
Fears are looming among many investors about a slowdown in China following years of breakneck growth, and what some believe is an inflating property bubble. Others, however, are more optimistic; the World Bank predicts the Chinese economy will slow to a 8.2% growth rate this year but rebound to 8.6% in 2013.
(Excerpt) Read more at money.cnn.com ...
For once I did good with stocks - moved everything out of my S&P 500 index fund about two weeks ago.
The obligatory blame “it’s George Bush fault”
I moved my TSP and my IRAs into money market equivalants a couple weeks ago. They won’t grow for now, but they also didn’t lose a penny when the market crested the hill and headed down. Folks thought I was nuts, but I can’t afford to take a third hit and wait for it to crawl back up. I wonder why guys like me lose the full value of the drop, but lag way behind the recoery...
Without more and more QE, deflation comes back to the front as debt soaks up all the extra money. Then with banks and big business holding on to cash, this will come back to bite them as more dollars laying around means there are worth less.
Government debt grows and big banks have to load up on low interest debt while electronic credits entered on the books looks good but doesn’t cover the falling value of the US dollar (sometimes called inflation).
The stock market needs another ‘fix’ of QE or down she goes which is not likely to happen in an election year (that is, will not be allowed to crash).
And without the world economy picking up, it will be hard for major companies to hand out dividends so more investors will sit on the sidelines waiting. Waiting for what, I don’t know.
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