US markets cowed: poor trend continues

By

US stock markets spent the week lacking confidence, and investors were quick to blame increased profit reports on technicalities, and reacted badly to even slight reductions in forecasts.General Electric’s 18% rise in profits was put down to tax breaks, and when 3M reported over 16% rise in earnings, not only did the markets put it down to mere currency fluctuations, but the company shares fell. Even IT giant IBM, in reporting good forecasts, was had its share value cut by 1.8%.Meanwhile, when faced with small bad news investors reacted badly. When eBay reported a lower dividend of 33 cents per share instead of 34 cents, the company had almost 20% of its share value wiped out. And when Motorola reports suggested slow growth, the markets responded with a 7.1% cut in share value.May Department Stores was one of the few successes in this week’s US markets, as rumours of a takeover sent the company value up by 9.2%.