US Market seems stretched out

September 05, 2007

US market still seems to be stretching more of its bounce back rally from big fall happened two weeks back. The investor’s confidence seems quite good even after a slight negative clue from economic data which was bit slower than expected and slight slowdown in manufacturing growth. Bargain hunting was clearly seen in technology and telecom sectors as these stocks were in limelight even after credit concerns, but demand for computers, cell phones and other such products appears strong.

The Dow Jones industrial average rose 91.12 points (0.68%) to end at 13,448.86. The Standard & Poor's 500 Index was up 15.43 points (1.05%) at 1,489.42. The Nasdaq Composite Index was up 33.88 points (1.30%) at 2,630.24.

Global markets were trading in mix pattern ahead of definitive clue from US economic data and upcoming Fed meeting in mid September. Profit booking was clearly seen in majority of financial stocks in European market on renewed concern about the extent of the credit crisis, and coming event of Thursday's interest rate decisions by the European Central Bank and the Bank of England.

Looking at the present situation, it clearly seems like US market is too stretched after the good bounce back rally and profit booking is clearly evident at this point. From stock investor’s point of view, it is still not a good time to make any stock investing rather than I would prefer to book my profit.