Couple of stories on the recent action in the stock market. Let's look at what's happening with two of the biggest players on the world stage, the U.S. and China.
"Wall St. falls ending 5-week rally". FT.com noted during the afternoon trading session that a down performance on the day would end "a winning streak that had driven blue-chip stocks on their best run since 1927.".
And that's what happened, as CNNMoney.com reports in, "Dow's record run done". An excerpt from that piece:
The Dow Jones industrial average closed lower Tuesday, ending its bid to claw out the longest up streak in Wall Street's history.
The Dow (down 7.07 to 13,305.90, Charts) ended about 4 points lower, after finishing with record closes for five sessions in a row. The blue-chip barometer has risen in 24 of the last 27 sessions - a feat last achieved almost 80 years ago.
Meanwhile, things are getting very hot again in China. The country's mainland stock exchanges are registering huge gains, with the Shanghai composite index up about 50 percent thus far in 2007.
Despite recent one day market drops of 8 percent or more, China's investor population is shrugging off fears of a bubble and piling into stocks, as FT reports.
China’s stock market brushed off a central bank warning about the danger of an asset bubble on Tuesday and rose to another record high in a sign of the government’s waning ability to control share prices.
At least three state-run newspapers ran prominent stories about the warning from Zhou Xiaochuan, governor of the People’s Bank of China, in Basle on Sunday. When Mr Zhou was asked if he was worried about a bubble forming in the stock market, he said he was.
But his comments, the latest in a series of official public statements expressing alarm about the level of the market, were ignored by investors, who bid up the index by nearly 3 per cent.
Apparently, warnings from government officials do not carry the influence they once did in this red-hot Chinese share market.
See this week's Financial Sense Newshour interview with Puru Saxena for more info on the Asian economies and the current mania in mainland Chinese share markets.