This is The Wall Street Digest Hotline Update for Friday, October 26, 2007, at 6:00 p.m. EST.
Energy and technology stocks pushed the market higher today. At the close, the Dow jumped almost 135 points, closing at 13,806; the Nasdaq gained 53 points, closing at 2,804. Oil closed up $1.40 to $91.86 per barrel, and gold closed up $16.50 at $787.50 an ounce.
Oil set a new record high today on tight inventories and the Turkey/Iraq squabble. Third quarter California Home Foreclosures soared 166.6 percent year-over-year. Mortgage lenders sent out 72,571 default notices during July, August, and September.
The FOMC will meet on October 30th and 31st, to review monetary policy. The deepening housing slump could force the Fed to cut interest rates by 25 to 50 basis points on October 31. The mortgage mess and the credit crisis will take another 18 to 24 months to sort out. U.S. stock prices should move higher in November and December after the rate cut on October 31.
Record global liquidity is producing a global boom unlike anything we’ve seen before. China, India, Brazil, Asia and the emerging markets are leading this greatest of all bull markets. China’s money supply is growing at better than 18 percent annually and producing a GDP of only 11 percent.
Stay fully invested! Stock prices in China, India, Asia and the emerging markets will outperform the U.S. stock market because of the falling dollar, which fell to a new low today. Global/international investments will enhance your investment returns as the dollar declines against other currencies. Stay close to our telephone/e-mail/website Hotline Updates.
The next Hotline Update will be on Tue