World Markets Fall
The Selloff started in China, then the US followed suit, as also the rest of the world. The DOW fell by 416 points, the biggest since 2001.
What happened in China, was probably the result of the following events.
The market has been on a tear, it doubled in value, the day before the selloff it reached a brand new record high, this is sometimes a classic sign to the end of a bullish run, the market has gone up so high so fast, so this was a combination of a natural correction in the market, as well as reports that the government will be cracking down on illegal trading, and the speculative market.
And back to The United States, Alan Greenspan used the big “R” word in his which could have been some hinting at a possible recession in the near future.
So, a market wide selloff in China, continuing bad news in middle east, and a possible end to the bull run, probably were all key in this decline in the market — showing just how interconnected the global market truly is, that a decline in one market can have such influence in other markets in the world.
So, what is the psychology of the market?
When you near the end of a Bulll run, it sort of becomes a game of musical chairs, where investors start to respond to any signs of a stoppage in music.
Astonishingly, The Dow was down 500 at one point, and they say, could’ve been a result of a computer glitch, nevertheless, the true correction of 416 is a real big drop.
Could this be the harbinger of doom? Let’s wait for China to wake up from its sleep, and see how the market reacts from a forgettable day of investing yesterday.
And The Philippines also joined in all the downturn fun, as our markets also fell.
