Stocks Fell Sharply on Friday

Yesterday, Wall Street had another low. After the sharp fall in January, the stock market was hit again severely. The reason why this is happening again is because of the depressing economic market, negative corporate reports and high oil prices.

Consumers still don’t have confidence in our economic future. The tax deadline is right around the corner. Even with the federal tax rebate, most of the middle-income class is still in bad shape. Besides that, consumers fear the uncertainty of the market in the future. The real estate market is still experiencing its lowest point and banks and lenders are making borrowing tougher. A good credit history, 5% down payment, and W-2 forms are required form many lenders.

Corporate reports have reported lower revenues for 2007. Many firms are still eliminating their fixed cost. Companies like BMW have decided to cut another 2,500 positions by the end of this year. Firms are holding back on their investment. Prices for goods and services are increasing because of inflation, which makes corporate revenues decline further.

For the first time ever, oil prices are over $103 per barrel. On average, the price of gas is over $3.20 per gallon nationwide. The president said that the gas prices are not likely to go over $4.00 per gallon. He pointed out it was uncertain. However, it looks like it might keep going up.

Stock markets had some gain at the beginning of last week. Anyway, on Friday, it lost all the gain it has made. The Dow fell 315.79 points, which was a 2.51% decline. The 500 index lost 37.05 points, or a 2.71 % decline. The only thing that is rising now is the bond price. Investors are expecting more negative news this weekend.

http://biz.yahoo.com/ap/080301/wall_street.html?.v=5

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