LS Trader - The Stock Markets Keep On Falling

The US markets tumbled today with the news that insurance company AIG will need a further government bailout of $30 billion after they posted their biggest quarter loss to date of $61.7 billion. Wall Street fell by 199 pips closing at 6792. Wall Street is now at a 12 year low. The S&P 500 remained its downward spiral falling over 20 pips and just managing to close above the 700 level, at 705.9, which is the lowest since October 1996. The US markets are now at their lowest level since December 2003.

We also saw the FTSE 100 fall by 160 pips closing at 3595. This was over a 4% fall in a single day and took the FTSE to its lowest level for 6 years. I feel that the FTSE is going to keep falling and I can personally see it going as low as 3000.  There is no confidence in the market, and really it is bad news after bad news. It is hard to see a recover in the imminent future. We saw also similar trends in both the German Dax and the Japan Nikkei 225 which both fell respectively.

HSBC was a major casualty of the day falling 20% in London and experiencing the biggest downfall for over 15 years, as HSBC revealed that it needs billions of pounds in new capital to cope with the ongoing financial crisis.

The Stock Markets look set to fall even lower and I don’t think anyone can see any kind of recovery around the corner. Everyday seems to bring more and more bad news, and I think people are starting to see that it is going to be a long and hard recovery.

The LS Trader system is short in the stock markets, and we have profits of 1500 pips in Wall Street, 106 pips in S&P500, 369 pips in the FTSE 100, 718 pips in the German Dax, and 565 pips in the Nikkei 225. We remain bearish in the Stock Markets and as far as we are concerned they still have a long way to fall!

I hope you enjoyed reading today’s update.

Kind Regards,

Robert Stewart