It was a wild and wooly couple of weeks on the international stock markets. But is the recent slide to a stop ... or just a breather before tumbling some more? And more importantly, what does it mean to astute penny stock investors?
Wall Street recently stumbled to its worst week of the year, and global stock markets fell on concerns about rising interest rates and slowing growth. After rising almost 9% in the first four months of the year, the Dow Jones Industrial Average fell about 6.5% of a six-year high, reached May 10, 2006.
Inventories are ailing because penny stock investors fear the Fed could be so focused on inflation that it ignores signs of an economic slowdown, raises interest rates too high and sends the economy into a recession.
Global stock markets were sent reeling last week after golden tongue U.S. Federal Reserve Chairman Ben Bernanke shocked penny stock investors in saying the Fed will continue raising interest rates to keep. Inflation in check
And that decision will have a direct impact on the penny stock market. Higher interest rates hurt penny stock prices because investors believe it will curb. Economic growth and corporate profits
But why is inflation heating up? Higher energy costs. Traders and penny stock investors are also concerned that under way, Gulf Coast refineries and oil production sites could be damaged again this summer and fall. Officially the hurricane season
And higher interest rates have the ability to influence. Across the economy Finance charges on credit cards will rise. So too will rates on mortgages and mortgage loans, causing additional pressure on homebuyers and a softening housing market. Ultimately, it will cost more to borrow for expansion.
But does this signal doom-and-gloom for the penny stock market? Au contraire. While the temptation to sell everything can be overwhelming, some see this as a great opportunity. "I would not sell. Would I tend to buy," said one New York analyst.
So how exactly is this a chance? It just so happens that many companies caught in the downward spiral of the market are cheaper than they were a few weeks ago. And as any seasoned penny stock investor will tell you, buying a good penny stock if it's already beaten is not a bad way to make money over the long haul money.
If you can stomach some of the volatility that is. While many blue chip investors have difficulty handling unpredictability of the market ... it's par for the course.
So, "snap," said another watcher. A month of dizzying selling has been marketed in an attractive offer. Is it possible the markets will fall more? Absolutely. After all, no penny stock is a sure thing. But one thing is certain: "Stocks are much cheaper than they were two months ago."
A seasoned investor with a strong interest in international business and current affairs, John Whitefoot worked with Peter Leeds for the last few years. With over ten years of experience in the investment community, Whitefoot is dedicated to uncovering the news, trends and ideas that shape penny stocks on a daily basis.
Wall Street recently stumbled to its worst week of the year, and global stock markets fell on concerns about rising interest rates and slowing growth. After rising almost 9% in the first four months of the year, the Dow Jones Industrial Average fell about 6.5% of a six-year high, reached May 10, 2006.
Inventories are ailing because penny stock investors fear the Fed could be so focused on inflation that it ignores signs of an economic slowdown, raises interest rates too high and sends the economy into a recession.
Global stock markets were sent reeling last week after golden tongue U.S. Federal Reserve Chairman Ben Bernanke shocked penny stock investors in saying the Fed will continue raising interest rates to keep. Inflation in check
And that decision will have a direct impact on the penny stock market. Higher interest rates hurt penny stock prices because investors believe it will curb. Economic growth and corporate profits
But why is inflation heating up? Higher energy costs. Traders and penny stock investors are also concerned that under way, Gulf Coast refineries and oil production sites could be damaged again this summer and fall. Officially the hurricane season
And higher interest rates have the ability to influence. Across the economy Finance charges on credit cards will rise. So too will rates on mortgages and mortgage loans, causing additional pressure on homebuyers and a softening housing market. Ultimately, it will cost more to borrow for expansion.
But does this signal doom-and-gloom for the penny stock market? Au contraire. While the temptation to sell everything can be overwhelming, some see this as a great opportunity. "I would not sell. Would I tend to buy," said one New York analyst.
So how exactly is this a chance? It just so happens that many companies caught in the downward spiral of the market are cheaper than they were a few weeks ago. And as any seasoned penny stock investor will tell you, buying a good penny stock if it's already beaten is not a bad way to make money over the long haul money.
If you can stomach some of the volatility that is. While many blue chip investors have difficulty handling unpredictability of the market ... it's par for the course.
So, "snap," said another watcher. A month of dizzying selling has been marketed in an attractive offer. Is it possible the markets will fall more? Absolutely. After all, no penny stock is a sure thing. But one thing is certain: "Stocks are much cheaper than they were two months ago."
A seasoned investor with a strong interest in international business and current affairs, John Whitefoot worked with Peter Leeds for the last few years. With over ten years of experience in the investment community, Whitefoot is dedicated to uncovering the news, trends and ideas that shape penny stocks on a daily basis.
No comments:
Post a Comment