Category: Stock Market

The picket signs have been put away and the rabble-rousing masses are conspicuous by their absence. Wall Street is the world’s largest stock market and it is running as smoothly as Usain Bolt does the 100 metres race, but there is a worrying trend developing on the bourses. Investors are no longer playing the markets with the kind of gay abandon that marked out their approach some time back and its not just because playing the market has become tougher to win in and more fickle than ever. It’s a domino effect of a worse kind for the market with investors lopping off stocks they own and reducing their holdings in favor of safer investments such as that provided by the bond markets. There is a very real fear that this will remain a lingering sentiment; as they say, a crystal vase once broken can be fixed, but the cracks will always remain. This might be a lost generation of investors  [...]

The markets rallied on Friday, but nothing came of it. The S&P 500 was a bit flaccid, to say the least, and it is in many ways a strong reflection of sentiment across the board that is tepid and hesitant. Remember that traditionally September and October are not a good month for stocks and you have good reason to draw just an inch closer to that panic button right away. Volumes have been light and individual investors are not picking up stocks the way they used to, and that can be seen quite clearly in the mutual fund market. Here’s a simple fact; bond funds have recently attracted $25 billion while equities have seen $12 billion fly out of their hands. That is an alarming figure. This is a clear message from investors that they don’t believe the recovery is on track and that they want to keep their money where they can keep an eye on it. Most of these individual investors have  [...]

After the release of private sector hiring statistics, investors reacted positively by pouring in money into the market. Stocks, on Wednesday, closed on a higher quote. Dow Jones Industrial Average increased by 44 points or 0.4%. S&P 500 index also gained 0.6 % by climbing 7 points. And NASDAQ added 0.9% or 20 points. The major reason of rise was surprising improvement in private sector payroll statistics. People are now awaiting a major report to be released by Labor Department on Friday. Besides, the industry report says there has been growth in the service sector for the seventh month in a row now. The pace of employment and recovery is modest. However, we are sure of one thing: at least the pace is being maintained. Corporate companies have been showing a decent profit for two months, and it is helping the economy to relocate its position to a better place. However, weak  [...]

When you bet against stocks' upward movement, it's short selling. In this method, you must borrow stocks from your brokerage company, sell them at a higher price, and buy back at lower price. You (short selling traders) can benefit only when the market or a stock declines due to unexpected consequences. The method is of short selling stocks is quite simple. You borrow stocks from your broker by paying a small fee (administration or financing fee), and give it back after selling the stocks at higher price and buying at lower price. Thus you make a profit without investing much. Probably the below mentioned example would make things clear. Stocks of company XYZ is being traded at $20 per share. You learn the company doesn't have surplus stocks, thus loss is inevitable. In such situation, you must borrow around 100 share at $2,000, and sell them when the price reaches $10 due to bad news.  [...]

What’s an IPO? IPO, also known Initial Public Offering, are shares of a company sold to public for the first time. Through such IPO’s, companies that aren’t currently listed on stock exchanges manage to receive capital for their project. As soon as it sells all their shares, and receives funds, the company gets listed on the exchange. IPO is considered to be a good investment product, as shares are available at cheaper price. With the growth of the company, the price then keeps mounting, providing a good return on your investment. However, this investment can sometimes be a disaster, if the company doesn’t perform well. Hence, it’s imperative to take following steps before you invest your money in an Initial Public Offering (IPO). Check Company’s Background Before you put your money in an IPO, make sure you know their business very well. Know about the business model  [...]

Whether or not one invests in stock market, Dow Jones is an exchange known by majority of people around the world. Dow Jones Index is an index used to gauge the everyday performance of specific stocks. Similarly, Dow Jones Industrial Average gauges performance of 30 established US stocks, and compares current prices with previous closing. It is an average of performance of all the 30 stocks. So, if the industrial average goes down, these stocks, on an average, aren’t performing well. And if it’s up, they are doing well. The performance is measured in points. Hence, it’s easy to gauge the magnitude of rise and fall. The question, however, is, how is it calculated. There isn’t any mystery behind it. It is calculated using a Dow divisor. In a generally average method, the sum of the parts is divided by the number of parts. Here, parts are thirty. However, they use a different figure  [...]

For beginners, a stock chart is an essential tool to start investing in equities. This chart keeps updating stock movements during trading hours, helping investors gauge the fluctuations instantly. However, it become difficult for a beginners to read stock charts if they don’t possess appropriate knowledge. For them, it would simply be a bunch of colorful lines. If, however, you are a trained observer, these lines are powerful indications of a company’s performance. For most traders, it’s a crucial tool. There are several types of stock charts used to indicate stock movements. Before we try to understand each of them, it’s important to note that these charts, regardless of their type, share similar axes. The horizontal line or x-axis indicates time, while the vertical line or y-axis talks about price movements. Hence, each chart must be read from right to left. The simplest  [...]

Gauging the performance of a company isn’t much difficult if you know certain ways and formulae used by most traders. A similar formula, debt to equity ratio, is a way to ascertain company’s value by determining its debt and assets. Hence, let us understand what does this ratio mean, how it works, and when should one use it. Debt To Equity Ratio – Meaning One can measure the current financial performance of a given company by calculating its debt to equity ratio. This is done by dividing the amount of liability the company has by the amount of equities it holds. The final amount derived will mention the debt to equity used by that firm to finance its assets. Debt to Equity Ratio Formula: Debt to equity of Company ‘X’ = Total Liabilities / Total Shareholders’ Equity Liability, in this ratio, is not always the total amount of outstanding amount. Sometimes the amounts of long  [...]

Though not much movement was seen in the morning, most stocks jostled during the close and ended positive. NYSE closed at 7,474.02, gaining 47 points or 0.6% on previous close. DIJA closed 47.6 points up at 10,734. 0.5% surge in Nasdaq helped to gain 11. 1 points, closing at 2,389. PLCM gained mainly due to its recent tie up with an Indian based corporation. FUQI, however, witnessed a fall as it failed to maintain or exceed its previous Q4 statistics. Experts believe BBI may file for Bankruptcy, hence a plunge was expected. Though HIG was low throughout the day, it observed re-bounce quite immediately after share sales were announced. More than fundamentals, a major reason in sudden rise of the market was the Wednesday evening announcement of Japanese Federal Bank and the Federal Reserve that promised to maintain interest rates at lower figures, which they say, will drive the economic  [...]

A sudden plunge in a stock price, these days, doesn’t really surprise any investor as, we all are quite aware about this, the market isn’t run by fundamentalism. If it does, it depends on quarterly revenue data like EBITDA, EBIT, margins, and EPS. In short, all the data used by market to gauge the performance can be found in the income statement. It, therefore, is the most significant financial statement. The cash flow statement, however, is something that really drives the value in the market. It includes dividends as well. Many companies this week furnished shareholders with a higher dividend. A significant player, Myers Industries (MYE) is involved in production of polymer products for agricultural, industrial, commercial, consumer, and automotive markets. It provided a steady dividend. On March 5th, however, the company raised quarterly dividend by 8%, which totals $0.065 per  [...]