Thursday 8 September 2011
Global Market Going Down Trend
U.S. markets were closed for the Labor Day holiday, reports elsewhere continued to point to a global recession and bear market being underway.In Asia it was reported Hong Kong’s PMI Index fell to 47.8 in August from 51.4 in July. Not only did it decline to under 50, the level separating growth from contraction, but it was the worst deterioration of overall operating conditions in Hong Kong in 26 months.
In Europe, it was reported that Britain’s PMI fell to 51.1 in August from 54.4 in July, the steepest monthly decline in ten years (since April 2001 in the midst of the 2000-2002 bear market). Britain is not a member of the European Union, but members of the EU fared even worse. The PMI of the 17-nation euro-zone fell to 50.7 in August. With GDP growth of only 0.2% in the 2nd quarter, very close to negative growth (recession), and reports like this coming in for the third quarter so far, economists are increasingly saying recession looks to be unavoidable.
These reports followed the dismal Consumer Confidence and employment reports in the U.S. on Thursday and Friday, that provided further evidence of the continuing slowdown in the U.S. economy.
As a result, while the U.S. market was closed for the Labor Day holiday, markets in Asia, most already in bear markets since November, plunged Sunday night, and closed no better than mixed last night.
And markets in Europe plunged sharply yesterday, Germany, France and the U.K. closing down an average of 4.3%.
The declines dropped the markets of London and France back to, or close to, their lows of early August.
The Dow, which was also in an oversold rally until its plunges of last Thursday and Friday, looks like it has some catching up to do on the downside to the further market plunges elsewhere while it was closed yesterday.
I predicted earlier in the year that the financial firms that led the way down in the 2008 crisis, and back up in the market recovery from the March 9 low, would lead the way back down in the correction expected this year.
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| Global Market |
In Europe, it was reported that Britain’s PMI fell to 51.1 in August from 54.4 in July, the steepest monthly decline in ten years (since April 2001 in the midst of the 2000-2002 bear market). Britain is not a member of the European Union, but members of the EU fared even worse. The PMI of the 17-nation euro-zone fell to 50.7 in August. With GDP growth of only 0.2% in the 2nd quarter, very close to negative growth (recession), and reports like this coming in for the third quarter so far, economists are increasingly saying recession looks to be unavoidable.
These reports followed the dismal Consumer Confidence and employment reports in the U.S. on Thursday and Friday, that provided further evidence of the continuing slowdown in the U.S. economy.
As a result, while the U.S. market was closed for the Labor Day holiday, markets in Asia, most already in bear markets since November, plunged Sunday night, and closed no better than mixed last night.
And markets in Europe plunged sharply yesterday, Germany, France and the U.K. closing down an average of 4.3%.
The declines dropped the markets of London and France back to, or close to, their lows of early August.
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| London and France back |
