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2007-02-01 20:09:37 · 5 answers · asked by hadagali u 1 in Business & Finance Investing

5 answers

Since the end of 2003, the stock market has been in bull mode, recovering from the Dot Com Bubble bust. They took a heavy breather in the summer of 2006 because oil spiked and the Fed didn't look like it would lower interest rates. It recovered nicely beginning in August.

The Fed has major short term impact on the economy, because high interest rates reduce corporate profits - and profits drive the stock market. The Fed worries about inflation, but it looks like inflation is contained for now, and the economy looks to grow at a good 3-4% this year.

In other words, it looks like the U.S. economy is headed for a "soft landing," hitting the sweet spot of low inflation and good growth. If so, stock prices could rise for another year or two.

Of course, things could turn around tomorrow. If you're asking out of curiosity, then there's your answer.

If you're asking because you're thinking of investing, my advice is, don't. Every bubble eventually bursts, and the greater the bubble, the greater the burst. If you don't do your homework and learn why prices rise and fall, and are able to interpret the signs of a rising or falling market, then you will eventually get burned, severely. Most of the people who make millions during the Dot Com Boom lost all of it, and more, during the Dot Com Bust. Timing the market without serious research and study is suicide.

2007-02-01 23:44:24 · answer #1 · answered by Anonymous · 1 0

Strong Corporate Results and Booming India Economy turns FII to Indian Stock Market.

2007-02-02 05:25:30 · answer #2 · answered by sanat.vats 1 · 0 0

Because of Bulls kingdom.

2007-02-02 05:16:00 · answer #3 · answered by thinkpose 5 · 0 0

because of FFIs speculative investments. this bubble may burst at point of time. so be careful with this over optimistic propaganda
pragna

2007-02-02 06:53:24 · answer #4 · answered by Anonymous · 0 0

Increase & decrease ~ this is the game.

2007-02-02 04:27:12 · answer #5 · answered by saumitra s 6 · 0 0

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