The markets took a dive today as the Dow Jones Industrial lost 245 points (-2.72%) and the S&P 500 lost 28 points (-3%). The ebbing and waning of Wall Street appears to be the result of battles between the bad news given by major businesses and optimistic reports of Obama’s stimulus package. It appears that today the bad news outweighed the good.
The bad news came from multiple sectors today. Intel lowered its revenue expectations for the 4th quarter by $500 million. The scariest part of this news is that the drop in sales cannot be attributed to a failure of the company. This means that the economy is simply to blame.
Major aluminum producer Alcoa reported that its will be reducing output and its workforce in the coming year. Time Warner added to the pessimism, after it estimated a 4th quarter loss.
As if all this wasn’t enough, the ADP National Employment Report came out today. The report that precedes the government’s unemployment statistic estimated that we lost 693,000 private sector jobs in December. The government’s unemployment report will be released on Friday.
Don’t expect the dreary news to end any time soon. But, do expect national optimism to increase as president-elect Barack Obama’s inauguration day gets closer (Jan 20th). While the bad may have won the fight today, tomorrow is a new day.
-Matt Schwartz
College Trillionaire
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