Massacre on Wall Street
Jun 15, 2011
Posted by Jody Eisenman | Filed under Uncategorized
All is not well in the stock market. We have now had six consecutive declining weeks. If this week ends in losses (as we currently are), then it would mark the first time is over ten years that the market has fallen for seven consecutive weeks. From the market peak, the DJIA has now fallen over 1000 points since the beginning of May. The culprits are numerous: Greece, the economy, the housing market, the banks, etc. Speaking of the banks, they have looked awful lately. Goldman Sachs, Bank of America and Citicorp are all trading near their 52 week lows. On a technical basis, the S & P 500 has fallen through several support levels rather quickly, and now stands at 1265. The next meaningful support level is around 1235. However, we are short term oversold and this week is options expiration, so a bounce like yesterday is always possible.
Meanwhile, today’s hot technology IPO was Pandora, which does online radio. Pandora got a coveted one letter symbol (P). Pandora originally filed at a range of 7-9, got upped to 10-12, and was finally priced at $16 on strong demand. This did not stop Pandora from trading up to 26 early in the day. However, profit taking set in later, the stock finally closed at 17.42. At one point today, Pandora had a market cap of over $4 billion, which is quite a feat for a company with no profits as of yet. Is this the sign of a stock market bubble?
