Dow Jones Crosses The 10000 Point Barrier

By: Mike Campbell
For the first time in a year, the Dow Jones Industrial Average has closed above the 10000 point level. It actually closed at 10015.86 which was its best level since last October. The markets were responding to good news coming from the troubled banking sector after major US bank J P Chase Morgan posted better than expected profit data for Q3. The bank, which is the second largest in the USA, posted net income figures of $3.6bn for Q3, up from a meagre $527m for the same period in 2008. Goldman Sachs is expected to announce a good performance when it declares Q3 figures later today, but Citigroup is expected to follow Bank of America in announcing a loss when it publishes its figures tomorrow.

In Europe, the major stock exchanges all gained by around 2%. The banking stocks did particularly well with Barclays up 6.6% in London; Société General up by 4.7% in Paris and Deutsche Bank climbing by 4.2% in Frankfurt.

The Greenback has been continuing its decline against other major currencies in recent weeks. The positive side to a weaker Dollar is that it makes US exports more competitive in international markets and conversely, it makes the importation of goods to the US a less attractive prospect. These facts were responsible for better than expected trade deficit figures which dropped from an estimated $31.9bn to $30.7bn in July. Since the Dollar has slipped by 7.5% against the Yen and 5.5% against the Euro between July and yesterday’s close, it is likely that the deficit will have continued to shrink when data is published for all of Q3. Once the US economic recovery get into full stride, domestic demand for imported goods could cause the deficit to widen again, but it will depend on the value of the Dollar since a cheap Dollar may make imports prohibitively expensive.
Comments

Did you have a good experience with this broker? A bad one? Tell our team and traders worldwide about your experience in our User Reviews tab. Your email address will not be posted.

exclamation mark

Please make sure your comments are appropriate and that they do not promote services or products, political parties, campaign material or ballot propositions. Comments that contain abusive, vulgar, offensive, threatening or harassing language, or personal attacks of any kind will be deleted. Comments including inappropriate will also be removed.

0 User comments
Add Comment

exclamation mark

Please make sure your comments are appropriate and that they do not promote services or products, political parties, campaign material or ballot propositions. Comments that contain abusive, vulgar, offensive, threatening or harassing language, or personal attacks of any kind will be deleted. Comments including inappropriate will also be removed.

Read more
Add new comment
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.