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Market Impact

November 7, 2012 – 5:57 pm

This morning, the day after the presidential election, the market decided to take a strong position falling well over 200 points within the first hour of trading. It would be easy to point to the election as the culprit but maybe that is a little too convenient.

Yesterday, the market rallied looking forward to the end of the uncertainty of the election so why the fall today with certainty as President Obama is re-elected? Frankly, it may all be due to Europe not our election.

Olli Rehn who is the Economic and Monetary Affairs Commissioner for the EU stated that in 2013 the euro-zone economy will be flat, no growth at all as Germany, the largest, strongest economy in Europe struggles under the debt crisis in the rest of Europe. That was a dramatic fall in projections from 1% to 0% percent growth for the EU and that announcement took Wall Street by surprise.

At the same time Greece is voting on austerity looking for parliamentary approval by the Prime minister.

Europe still has the power to surprise us affecting our market. It just may not have the impact it did a year or two ago. For today though the impact is clear.

Good Trading
Steve Peasley

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