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WORLD> America
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Wall St. closes out on 2008, year of record losses
(Agencies)
Updated: 2008-12-29 10:42 NEW YORK -- Investors are preparing to close out the last three trading days of 2008, a year in which Wall Street has logged its worst performance since Herbert Hoover was president.
The ongoing recession and global economic shock pummeled stocks this year, with the Dow Jones industrial average slumping 36.2 percent. That's the biggest drop since 1931 when the Great Depression sent stocks reeling 40.6 percent. The Standard & Poor's 500 index is set to record the biggest drop since its creation in 1957. The index of America's biggest companies is down 40.9 percent for the year. With these statistics ready to play out this week, it is little wonder why investors are all too happy to close the books on 2008. Analysts are already looking toward to January as a crucial period for the market as it tries to recover some of the $7.3 trillion wiped from the Dow Jones Wilshire 5000 index, the broadest measure of US stocks. "It is hard to gauge a recovery because there's so many things out there that are interactive with each other," said Scott Fullman, director of derivatives investment strategy for WJB Capital Group in New York. "Nothing is in a vacuum. Anybody who is managing money has to be on the cautious side for at least the first six months of 2009." He said many analysts are jumping past this week and focusing on next month, especially with Barack Obama set to be sworn in as president on Jan. 20. There is hope that the new administration will deliver another stimulus package, which along with December's interest rate cuts, might help quell the financial crisis. Trading is expected to remain volatile with many market participants on the sidelines during the holiday-shortened week, but that doesn't mean investors won't be kept busy. With no Santa Claus rally last week, economic data slated for the coming days could sway the market's mood going into 2009. Late Sunday, traders began to pull back slightly in early futures trading. Dow industrials futures fell 36 points, or 0.42 percent, to 8,436. S&P 500 futures fell 3.40, or 0.39 percent, to 865.50, while Nasdaq-100 futures dropped 5.00, or 0.42 percent, to 1,183.50. Investors will be awaiting details about how retailers fared in the post-Christmas sales period, especially since consumer spending drives more than two-thirds of the US economy. The main question is if bargain prices at the malls will be enough to rescue retailers from a bleak holiday shopping season. Meanwhile, another gauge of how Americans feel about spending money will be released on Tuesday. The Conference Board will issue its December index of consumer confidence, which is expected to rise to a reading of 45.2 for this month, up slightly from 44.9 in November. The Labor Department will report on weekly jobless claims Wednesday, after a 26-year high of 586,000 initial filings in the week ended Dec. 20. But the most anticipated economic data will be delivered Friday when investors get a fresh reading on the manufacturing sector. The Institute for Supply Management releases its December survey of purchasing managers. |
