Sunday, Nov 9, 2008
Like anxious relatives in a hospital room, investors have been watching the economy get sicker and sicker with new symptoms surfacing daily.
That trend is likely to stick in the week ahead, and the stock market should stay volatile as it reacts to economic news, including Friday’s retail sales report. The economic calendar though is fairly light, but there are earnings reports from major retailers. Those numbers should only confirm that the holiday shopping season is shaping up to be one of the weakest in years.
Many economists have been expecting the current quarter to show this recession’s biggest decline in GDP. A batch of weak data and growing unemployment has made it seem especially bleak.
“I think you can kiss Christmas goodbye this year,” said BlackRock Vice Chairman Robert Doll in a phone interview on the market and economy the past week.
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Doll said the economy had been “iffy” for the first eight months of the year, and companies were on the fence about hiring. But after the Lehman bankruptcy, the economy “went off the cliff” and companies starting chopping their workforces, which hurts investor and consumer confidence.
- A d v e r t i s e m e n t
In the coming week, the global credit crunch is back in focus as world leaders head to Washington for next weekend’s meeting on global financial markets and regulation. Traders are also watching as President-elect Barack Obama meets with President George Bush Monday. There is some expectation the president elect could identify a new Treasury Secretary in the days ahead of the G-20 weekend meeting.