The Beige Book Shows Improvement, Rate Decision Ahead

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The Beige Book Shows Improvement, Rate Decision Ahead

Post  harpal1980 on Thu Jan 14, 2010 8:54 am

After Tuesday’s sell-off, the major U.S stock indices bounced back during yesterday’s session despite disappointing earnings. The broader market index (S&P500) traded mixed for the first quarter of the trading day, but quickly gained momentum to close with a gain of 0.83%.


Google had a major impact on the trading day, as the internet giant’s stock dropped. Even though it didn’t manage to drag down the indices, the stock’s movement still rattled certain participants, who preferred to cash in on recent gains. Google’s stock price dropped dramatically at the start of the session as news headlines stated that Google could be pulling out of China, minimizing its business activities there. The stock price immediately dropped and traded at the start of the session below its 50 day moving average. Towards the end of the trading day, the large-cap managed to regain some of its weakness and close with only a -0.57% loss.


Fundamental data also had an impact on the intraday session as the famous Beige Book was released. According to the report, the economy improved at a modest rate, due an uptick in home sales and an improvement in the manufacturing sector. The Book that reports on current economic conditions in each of the 12 Federal Reserve districts showed that 10 out of those districts showed improvement. Consumer spending picked up throughout the 4th quarter, but commercial real estate remained weak.


All of the nine major sectors closed in green yesterday with Healthcare leading the way higher. Financials also bounced-back and finished with a gain of 1.13%.



Read the full article at Dodjit.com

harpal1980

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