stock markets: Will October 2014 take its place in this grisly hall of fame? No, said the financial experts who profess to be puzzled by the way in which the sell-off of the past 10 days has snowballed. There is, they say, no real reason for the panic. Global growth prospects are solid, if nothing to write home about. Central banks are still providing plenty of stimulus. Interest rates and inflation are low. Banks have more capital than before the financial crash of 2008, according to The Guardian. But there are five reasons why markets are rattled; five factors that have come together simultaneously to create the right conditions for a severe correction and Historically, October is a bad month for stock markets. It took a consortium of Wall Street grandees, led by JP Morgan, to end the panic of October 1907. Twenty-two years later, October 1929 saw the tumultuous selling that began the slide into the great depression. More recently, October 1987 saw the Dow Jones drop by more than 500 points on Black Monday. These are all reasonable points to make and, if nothing untoward happens over the coming weeks, it may well be that the big drop in share prices will prompt bargain hunters to pick up shares when they look cheap. In that case, the retreat in stock markets will prove short lived, as it did in 1987.
(news.financializer.com). As
reported in the news.
Tagged under , topics.