Posted on Monday, 29th June 2009 by admin
This has been another rough week on the stock market as it is the 2nd week in a row where stock markets end-up in the red zone. Pushed by their emotion from the previous week, investors tumbled under the pressure when the World Bank issued its concerns towards the current global recession.
US Stock Market
Discouraged, investors received “bad” news this week. The American consumers are now gathering their pennies and keeping them for themselves! Hence, the American saving rate surged to 6.9% in May compared to 5.6% in the previous month. This is a record high for the past 15 years!
Since Americans are paying down their debts and saving their money instead of buying more goods, we are in right to believe that they may not become the power that will push the economy out of this recession. Therefore, we may have to look on the Eastern side of the globe for an economic saviour.
Canadian Stock Market
The Canadian Stock market was hit by unexpectedly bad results from RIM and Potash a couple of weeks ago. Potash keeps deceiving as it shows lower sales expectation at a lower price. It seems that China and Brazil massive investment in R&D is giving its fruits.
Resources, currencies and others…
The oil barrel stayed relatively stable and got close to the psychological bar of $70. The war in Nigeria should help the barrel maintain this level for a few weeks. Speculators are ready for actions!
While US dollar gained a few cents against the Canadian dollar, we still have some concerns. The Central Bank of China actually requested alternative money to the American dollar. It reinstated its wishes to have another reference for international transactions. Therefore, we expect the US dollar continue to tumble compared to other currencies.
Posted in Market Commentary | Comments (0)
