Chris Cantell Discusses Markets: Current situation on stock markets by Martina Janeckova

The credit crisis continues to have impact on the economy. The last reminder of this came on Monday August 11, when JPMorgan said it has incurred wider losses in its mortgage holdings in the third quarter than in the second quarter of 2008- $1.5 billion compared to $1.1 billion. JPMorgan fell $3.90, or 9.3 percent, to $37.99. Goldman Sachs Group inc. fell after several analysts lowered their ratings and earnings estimates for the investment bank. It declined $11.21, or 6.3 percent, to $166.79. UBS AG, Switzerland’s largest bank, also reported further losses. UBS fell $1.34, or 6.2 percent, to $20.35. Wachovia Corp. fell $2.17, or 11.9 percent, to $16.04. The market’s losses were mitigated for part of the session by a drop in the price of oil. The price of crude has fallen more than $30 from its July 11 high of $147.27. Light, sweet crude settled down $1.44 at $113.01 a barrel on the New York Mercantile Exchange. But the anxiety over the financial sector overwhelmed any good news about oil prices. Oil trading was influenced by several factors like different views on global demand and fighting between Georgian and Russian troops. Bond prices rose as stocks fell and investors were searching for safer investments. The dollar was higher against most other major currencies, while gold prices fell. The nation’s trade deficit decreased in June- the trade imbalance fell 4.1 percent to $56.8 billion in June from a revised May deficit of $59.2 billion. Broader stock indicators also declined. The Standard & Poor's 500 index fell 15.73, or 1.21 percent, to 1,289.59, and the Nasdaq composite index fell 9.34, or 0.38 percent, to 2,430.61.

by Martina Janeckova for PocketNews (http://pocketnews.tv)

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edited by Beata Biskova