When Barack Obama’s election victory was declared yesterday, the Dow Jones Industrial Average dipped 312 points. Today it again fell by 121 points, as a second straight day of mass sell-offs put the blue-chip index on pace for its biggest weekly decline since June.
The DJIA fell 430 points in just 2-day after election, investors getting impatient with Obama
The Dow declined 121.41 points, or 0.9%, to 12811.32, its lowest close since July 25. The pullback followed a 313-point selloff Wednesday, and together the 3.3% decline marked the biggest two-day drop this year. “The thinking before the election was that it would remove some of the uncertainty, but it seems to have done the opposite,” said Tyler Vernon, chief investment officer at Biltmore Capital Advisors in Princeton, New Jersey.
“The mood of the market has certainly switched,” said J.J. Kinahan, chief derivatives strategist at TD Ameritrade, as investors monitor developments on the fiscal cliff and wait for more clues about Obama’s agenda. Investors were initially encouraged by two positive reports on the U.S. economy that came out before the market opened. The Dow climbed as much as 48 points in the morning but started to sink as sudden massive sell-offs came after the first hour of trading.
The Labor Department reported that the number of people seeking unemployment benefits fell 8,000 last week to 355,000, a possible sign that the job market is healing. Another report showed that the U.S. trade deficit narrowed to its lowest level in almost two years as exports rose to a record high.
Sudden sell-offs in the markets as the rich are angered by Obama’s victory
“With the election over and the fiscal cliff right at the front of everybody’s mind, coupled with more signs of trouble out of the euro zone, you’re seeing a lot of people take some money off the table,” said Sean Kelly, head of institutional equity trading at Knight Capital Group.
The declines in U.S. dragged down Asian markets. The fears that the U.S. economy is facing another huge economic crisis spurred a sell-off in Asian markets Thursday as Barack Obama’s re-election raised the spectre of another bitter stand-off in Washington. Investors fear a deeply divided Congress will not be able to reach an agreement to avoid a so-called fiscal cliff at the end of the year that many say will send the United States back into recession.
Tokyo tumbled 1.51%, or 135.74 points, to 8,837.15, Sydney fell 0.72%, or 32.7 points, to close at 4,483.8 and Seoul lost 1.33%, shedding 25.83 points to 1,911.09. Hong Kong skidded 2.41%, or 532.94 points, to 21,566.91 and Shanghai fell 1.63%, or 34.22 points, to 2,071.51.
The losses extended into Friday, with Tokyo currently down 0.9% while Hong Kong off 0.4%. South Korean shares drop 0.7%.
Europe, Asian markets dragged down by the sharp fall in the U.S.
The initial upbeat reaction Wednesday to Obama’s victory over Republican Mitt Romney was replaced Thursday with trepidation as the focus turned to the fiscal cliff, a combination of deep spending cuts and huge tax hikes to take effect on January 1.
“The focus has turned back to the economy after the U.S. election, with concerns over euro zone risk resurfacing while the fiscal cliff worries weigh on the local index,” said Kim Soon-young, an analyst at IBK Securities, adding that Asian shares could pare losses if China’s scheduled to-be released economic data is positive.
Source:
http://money.msn.com/market-news/post.a … 0f1697660a
http://www.theledger.com/article/201211 … c=pg&tc=ar
http://www.telegram.com/article/2012110 … 09454/1237
http://online.wsj.com/article/SB1000142 … 32390.html
http://www.reuters.com/article/2012/11/ … 7I20121109