Volatility continues in the market as Tokyo stocks fall more than 10 percent
and this negative momentum is expected to affect U.S. trading in a parallel way.
The VIX, used to measure volatility in the market surged 14% and The New York
Stock Exchange invoked Rule 48, which gives the exchange the right to pause
trading in the wake of extreme volatility. Volatility continues in the
marketplace as well as within the Fukushima Daiichi power plant in Japan as news
that a third explosion took place, which is exacerbating the nuclear crisis in
the region. The reactor meltdown is unprecedented and people around the world
are not sure how far reaching the negative ramifications will stem. The Federal
Reserve released a more positive statement on the general status of the economy
today siting that the nations economic recovery is getting stronger, inflation
remains in check and the central bank plans to continue to purchase long term
treasuries to assist with growth. The Fed did acknowledge there has been a
significant increase in commodity prices such as oil but did not feel this was
an area of concern as it was labeled transitory. In light of the most recent
events in Japan and the effects on the global economy, the most curious aspect
of the entire statement, in the eyes of many, was that the Fed did not make
mention of the devastating earthquake in Japan or the obstacles to recovery. At
close the major market indexes continue in the red. The Dow dropped 137.74
points or 1.15% to 11855.42. The Nasdaq lost 33.64 points or 1.25% to 2667.33.
The S&P 500 was down 14.52 points or 1.12% to 1281.87. The Treasuries 10 year
yield was down 0.02 to 3.32%. Oil dropped 3.53 to $97.65 a barrel. The U.S.
dollar decreased by 0.0005 to the Euro at $1.40. Author: Pamela Frost
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