US Markets began the session up over 100 points before beginning an afternoon slide at noon that continues to keep momentum stalled. Investors initially reacted positively to the government's plan to support Bank of America in a deal similar to one reached recently with Citigroup. Crude continued to decline despite opening high, while gold rose as investors remain uncertain. The 10-year Treasury declined sharply in the morning before recouping some of the decline as equity markets turned negative. Concerns remain high about the length of recession and financial instability.
Markets opened higher by as much as 125.53 points to 8341.20 before beginning a slide that saw the Dow 30 index turn negative midday. Markets moved lower this week and traded below 8000 to 7995.29 for the first time since late November. December retail sales, which were expected to drop 1.2% declined significantly by 2.7%. Despite Bank of America receiving government support, much clout over financials remains regarding further potential downside.
Crude started the session higher before turning downward once again on an IEA report that oil demand would drop a further 0.6% in 2009 to 85.3 million barrels per day. The news sent crude off its positive gains and into negative territory as investors remain concerned over future demand. Oil has seen a greater than double digit decline this week with more downside likely in the days ahead. Gold rose on the session as uncertainty in equity markets sent investors to the safe-haven metal. The 10-year Treasury fell earlier in the session to a low of 125.13 from an open of 126.27 before recouping some of the decline and rising back above 126.00. On the week, the yield has declined slightly but remains well off its December 29 lows.