Analysts: We Haven't Hit Bottom Yet

Market isn't following pre-recovery trends, say experts
By Matt Cantor,  Newser Staff
Posted Feb 21, 2009 10:28 AM CST
Analysts: We Haven't Hit Bottom Yet
Dilip Patel, left, and Glenn Carell, both of Bear Wagner Specialists, work on the floor of the New York Stock Exchange yesterday in New York.    (AP Photo/Henny Ray Abrams)

With its 6% dive this week, the Dow has now taken back all of its gains since the end of the last bear market in 2002. So we're ready to climb again, right? Not quite. Analysts tell the Washington Post that markets aren’t behaving as they typically do when they hit bottom. It's actually a little too calm, and bottoms tend to be "violent affairs," said one. "You sell hard, you rally hard, you go down hard and then you're off to the races. That's not what were seeing right now.”

“Until this week, the market was really drifting sideways,” he added. Analysts believe that before we see a recovery, we’ll see more fear, with many investors leaving the options market completely—which hasn’t happened yet. “There are a lot of nervous folks out there, waiting to see how low this market can go,” said another expert. “When people aren't convinced one way or the other, markets just drift down."
(More financial crisis stories.)

Get the news faster.
Tap to install our app.
Install the Newser News app
in two easy steps:
1. Tap in your navigation bar.
2. Tap to Add to Home Screen.