Assessing Stock Market Movements Essay

534 words - 2 pages

After reviewing the "Abreast of the Market" article from the February 1, 2005, edition of the Wall Street Journal, a clearer picture of the previous day's market activities is apparent. To recap, the DJIA gained 62.74 points (0.6%) to close at 10489.94; the Nasdaq Composite Index increased 26.58 (1.31%) to close at 2062.41; and the Standard & Poor's 500-stock index rose 9.91 (0.85%) to finish at 1181.27.Overall, the market prices increased on January 31, 2005, due to a number of acquisitions taking place; analysts and brokers consider the current mergers and acquisitions a positive indication that the U.S. economy is rallying thus causing prices to rise. Another sign of the economy improving is the 4th Quarter earnings posting of the exchanges' listed companies; many of the businesses have shown fair earnings reports for the final quarter of 2004 therefore giving market analysts additional signs of a steady growth. Of the mergers and acquisitions taking place, two major players in the markets are fueling the positive gains of yesterday: SBC announced its proposal to buy AT&T in a deal for more than $16 billion and MetLife announced its plans to purchase the Travelers Life and Annuity business from Citigroup for $11.5 Billion."ASSESSING STOCK MARKET MOVEMENTS" 2After analyzing the "Price Percentage Gainers and Losers" from the February 1, 2005 edition of the Wall Street Journal the list includes 100 Gainers and Losers from the NYSE, Nasdaq and AMEX. The Price Percentage Gainers were as follows:NYSE - Aviall (AVL): Price $28.81, Change 5.11, %Chg 21.6; Aviall's meteoric rise is due to their just announced a $5 Billion Lifetime Pact to Distribute GE...

Find Another Essay On Assessing Stock Market Movements

Bubbles in stock markets Essay

1586 words - 6 pages ‘The stock market’s movements are generally consistent with rational behaviour by investors. There is no need to invoke fads, animal spirits, or irrational exuberance to understand the movements of the market.’ Discuss in relation to the information technology bubble and its collapse.      Introduction      In a perfectly efficient market, it is assumed that all investors have access to all

Stock Price Valuation and Beta Calculation

1247 words - 5 pages value is greater than 1.0, which means the stock is the aggressive stock as they carry the greater systematic risk than the market. The stock will slightly increase or have the effects of market movements on the returns of a portfolio. Conclusion In conclusion, the Genting Berhad’s stock can be put into the investors’ consideration. It is true that its current market price is high compare with the fair price. However, the price increase with a

Financial Market Asm

4991 words - 20 pages December 2011 and unit root tests, runs test and variance ratio test to investigate the random behavior of Istanbul Stock Market. The empirical results suggest that past movements in stock prices cannot be used to forecast their future movements. Therefore, ISEM does not follow a random walk and is informational inefficient at the weak-form level.On the other hand, there are some contrary evidences were found to prove that ISEM is weak-form

Executive Compensation: Don't Blame the Pay Problem on the Incentive System

533 words - 2 pages accounting system only reflects the economic value added information. (Dutta & Reichelstein, 2005, 1069). Value added information such as company reputation and social capital are less likely to be manipulated in comparison to economic information. With stock option incentive in place, managers will strive for the optimal market and economic result instead of constantly trying to meet the bottom line of meeting revenue growth target. Therefore

Predicting Stock Market Return

2028 words - 8 pages capital and asset wealth and aggregate wealth. Trend deviation is considered as the strong component in predicting stock market returns and if the assumption of the consumption growth is not too elastic then the deviations from the mutual trend create movements on the consumption aggregate wealth ratio and forecast future asset returns. It is argued that for future market returns the components of consumption aggregate wealth ratios that is


2718 words - 11 pages , regulatory concerns and empirical researchers. Persistency in volatility clustering is normally due to the inefficiency in the market. Rizwan and Khan (2007) studied the volatility of the Pakistani stock market and found volatility clustering which signifies inefficiency in the stock market. They found that lagged returns are significant in explaining current returns. The volatility persistence measures the time period for which any shock has

Risk Management in Stock Valuation and Markets

2705 words - 11 pages fundamental analysis used for the valuation of the stocks. Fundamental analysis generally use the price earning method, dividend discount model, or free cash flow model for the valuation of the stocks. On contrary to it, we focus on the factors which affect the stock market and valuation of the stocks. Basic terms Stock Stock is a security that represents holding in a company and signifies a requisition on the company’s assets and profits ("stock

Ratio Analysis

1965 words - 8 pages to the working capital of the business i.e. – stock, trade debtors and trade creditors. It complements the liquidity measures and helps us to understand movements in some of the component parts of liquidity. a) Asset Turnover The Asset Turnover is a broad measure of asset efficiency. A ratio of 1.1 means that the business is generating £1.10 of sales for each pound invested in assets. This ratio is a measure of capital intensity, with

Islamic Economy in Saudi Arabian Companies

624 words - 2 pages companies domestic investment increased, which gave a boot to stock exchange. B. The Saudi stock exchange was not open to foreign investment, only shares of Saudi companies could be traded. In 1991 the Arab National Bank partially funded by Jordanian capital, received permission to launch a stocks. The estimated market value of shares was no more than 5 percent. This way the ownership was owned by institutions rather than individuals, which made

The I.P.O. Mania

3495 words - 14 pages similar forces behind the economic growth and the actions of Federal Reserve in both years, to come to the prescient conclusion that a stock market crash was imminent. The primary similarity between the market of 1929 and 1999 was the importance placed on technology stocks. Phillips stated that "technology stocks are the vanguard of major market upsurges and crashes" (1). This is justified by the major market movements in the early 1900's when

Risk and net Present value

7852 words - 31 pages variability is important to consider when assessing risk. Indeed, if you think about risk as the possibility of a stock losing its value, beta has appeal as a proxy for risk.Intuitively, it makes plenty of sense. Think of an early-stage technology stock with a price that bounces up and down more than the market. It's hard not to think that stock will be riskier than, say, a safe-haven utility industry stock with a low beta.Besides, beta offers a clear

Similar Essays

Determinants Of Conditional Volatility Of Fifty Stock Returns And Kse 100 Index

894 words - 4 pages indicators. The increased variation in money supply and inflation make stock return more volatile and the unexpected change in call money rate and term structure of interest rate adversely affects the stock return. Financial analysts’ strategic minds always cater to financial and economic indicators in assessing the future prospects of the stock market. The stock returns in addition to economic indicators in the form of inflation, money supply, gross

Can Above Average Returns Be Earned On Observing Stock Market Overreaction?

9651 words - 39 pages the research methods and criteria for assessing short-term price reversals in the case of price declines and the behavioural-based arguments leading to a belief in inefficiencies. Section 4 provides the crux of the research, implementing the methods set out in section 3 to assess stock market overreaction and to tease out the evidence of whether or not above-average returns are generated by short-term price reversals. Finally, the paper will be

Research Methodology. Essay

2422 words - 10 pages knowledge from it, they can try to avoid the loss as much as they can and also ear as much money as they can from the stock market.According to the current situation of the stock market, it near highs and lows and ready for lots of price moves, both up and down, therefore, stock buyers may make money capturing part of the price movements with the right trading methods and trade signals. The benefit is from frequent powerful price movements and

How Can Stock Index Futures Be Used For Hedging?

1708 words - 7 pages "points" which are used for share index.4 Stock index futures contracts is a kind of futures contracts which is in terms of cash transactionFuture Hedge, it means in order to lock spot purchase costs or profits in the futures market to establish a certain amount of the cash and futures positions in the opposite direction of the position. To use the futures-related losses to offset or compensate for the spot transaction on the profit and loss, so