Week of disappointments: Dow Jones Industrial Average had died for a moment, EU feared

Dow Jones failed again

In brief: Dow Jones Industrial Average responded to the European crisis and fell during some minutes. The situation is still remains unpredictable.

The world economy experienced a real shock last week. Dow Jones Industrial Average set a record in the fall, the causes of the collapse of major U.S. index remain unknown. The last week (May 3-7, 2010.) became the next test for the global financial system. Investors are not encouraged by the actions of the Government of Greece, as well as decisions taken by the EU and the IMF. The euro last week fell by 3.01% and remains under pressure.

Against the background of increased investment risks, market participants are hastily reviewing investment portfolios. Thus, according to experts Saxo Bank, investors rushed to seek shelter from the crisis, resulting in ten-year government bond yields in Germany dropped to record low – 2.8%. In addition, a role in the dynamics of world markets have played automated trading systems and traders’ mistakes. So, on Thursday, May 6, on U.S. stock exchanges saw the most spectacular crash of 1987 intraday. A few minutes Dow Jones lost almost 1000 points (most of whom later played). According to experts Saxo Bank, due to some mistakes traders panic and from electronic trading platforms lost bids for. In the absence of protective orders about 300 shares have lost more than 60% of its value, while some of them have fallen in price to 1 cent. By the end of the day the situation is normalized, the market has grown up and closed with a relatively modest decline.

Commodity exchanges also not escaped the shock. London Brent crude for the week of May 3-7, cheaper by 10.16% against the dollar rising and closing deals. Earlier this week, “black gold” consolidated near the $ 81 mark per barrel. The closest line of support is at 74.3 dollars per barrel., On its stability and determine the future dynamics of quotations. Gold was under pressure due to an expanding of the dollar, but because the precious metal has the image of the security asset, the demand for it has exceeded supply, and gold increased in price during the week at 1.72%, stayed for the psychologically important milestone of $ 1,200 / ounce. The immediate goal of growth of yellow metal is the level of the December peak at 1,226.5 dollars per ounce, while support is at around 1,180 dollars per ounce.

Ukrainian Globalist
2010-05-11 15:38, Economics.

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