A still buoyant Wall Street closed moderately lower yesterday, having scratch its way back from an early-session nose-dive after positive manufacturing data dispelled fears of flagging US economy. The Dow Jones industrials average closed 34 points lower after sinking 209 points in early trading and then momentarily reaching positive territory in the afternoon.
After Ben Bernanke, the Federal Reserve chairman, efforts to calm down anxious investors, the major stock indexes plummeted in early trading, which at one point of time reflected that Tuesday’s correction is far from over. However, the Institute for Supply Management instilled a bit of exhilaration into the market as it reported stronger-than-expected U.S. manufacturing conditions in February. In recent times American factory activity has been sluggish and many experts were considering it an initial sign of recession.
The US stock markets is apparently appears to be panic stricken as the latest trading points towards a pattern similar to past downward spiral: dropping sharply one day, retrieving some ground the next and then recommencing its slide. This clearly indicates towards the fact that investors are unable to retrieve their lost conviction in stocks.
In the meanwhile Greenspan, the former Federal Reserve chairman, has reportedly moderated his comments, telling a Tokyo seminar that an economic slowdown is not ‘probable’. However, he reiterated the idea that it was ‘possible’. Greenspan may not have affected the global stock markets but prediction that recession in the US economy is eminent contributed greatly to shake investors that eventually pulled down Dow Jones.
