Yesterday, the US markets traveled back in time. The Dow Jones industrial average tumbled 251 points to its lowest close since May 7, 1997, while the Standard & Poor's 500 index logged its lowest finish since April 11, 1997. Both indexes have lost about half their value since hitting record highs in October 2007.
The dire problems of banks did not help on the way to the bottom.
I am no expert on the US markets, and do not like to make any prognosis of the future but let me take a guess and predict the future.
I would say it is too early to look for a bottom here. It has to travel further down before we can hunt for bargains. Also, the recovery will depend a lot on how the situation is handled. Honestly, no one, at least not me, has an idea how the present measures will work out.
Meanwhile, the Dow impact was felt on Asian stocks too. The Nifty was trading below 2700 at the time of writing.
The Asian stock markets tumbled Tuesday, with Hong Kong's index down nearly 4 percent. Tokyo's benchmark hovered near a 26-year low as news that Nomura Holdings, Japan's biggest broker, will raise billions more in capital added to worries about the financial sector.
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