The Fall of US Stocks
Newmont Mining Corporation slumped 1.4 percent and Phillips 66, the crude refiner, slid 1.6 percent. The largest US fertilizer producer, Mosaic slumped 1,4 percent to $55.63. The S&P 500 fell 0.6 percent to arrive at 1,419.45 in New York, whereas, the Dow Jones Industrial Average slid 74.73 points to stop at 13,170.72. All 10 groups enlisted in S&P 500 index staged a fall, the biggest losers being the health-care, energy and technology companies.
The fear of fiscal cliff is still looming large over US economy. It is reported that if the US government fails to take effective steps soon, US may enter into yet another recession by the first quarter of 2013. Top US officials have so far conducted several rounds of talks but so far the talks have been unproductive. Though officials are optimistic that a consensus will be reached before Christmas, this is not helping the market to hold strong. The US market showed some positive signs after the release of the data depicting a drop in jobless claims, but the optimism seems to have faded away.
Indian Stocks Hold Strong
However, amid the global economic crisis the Indian stocks are showing some exceptional behavior. In spite of being faced with tough economic conditions, the growth rate of Indian economy has fallen a little as it maintained a growth even under worst of situations. The BSE Sensex rebounded as the wholesale price index rose 7.24 percent in November. Most of the major shares under BSE index gained. SBI gained 1.7 percent, Tata Motors gained 1.5 percent and RIL gained 1.4 percent. The Nifty rose by 0.38n percent to stop at 5,873.60. The latest data shows that inflation may be slowing down but experts are opining that it will not insist the Reserve Bank of India to cut interest rates at least until December.
Keeping a view on the global economic situation it is hard to arrive at any conclusion. On the one hand some forex traders are disappointed at the fall of US stocks, and on the other some are smiling due to a rise in Indian stocks. Forex traders should maintain utmost caution while taking any decision regarding the trade because a single wrong decision may jeopardize their whole business.