Crunch time is here at last for the economy, so to speak. The previous week and this coming week are both important times in the market sector this quarter. With the Federal Reserve meeting behind closed doors, political strife in the Ukraine, companies preparing to announce earnings and the market reacting to previous earnings, it is going to be a hectic time for those who work on Wall Street. Most importantly is how the investors on Wall Street will react to all of this news. If they see bad signs, then it will lead to a negative third quarter.
Even if investors like what they see with all the other factors, things could still end badly. If the political crisis in the Ukraine turns violent then it could cause major repercussions for the economy. This has already had adverse effects in the economy since the crisis began and people started to shift their assets into more reliable options, such as gold and bonds.
Besides the Ukraine, the FED meeting has left many wondering as to whether Janet Yellen will continue to reduce the bond buying. Also, many are wondering when Yellen will begin to raise up interest rates. This has some Wall Street investors worried. The most important indicator that will help to judge the health of our nation’s economy is the jobs report April. This will be the most accurate way to tell how strong our economy is doing. Also of note is that the GDP growth from the first quarter is down to 1.3 percent this is a tremendous drop from the fourth quarter of last year, where GDP was 2.6 percent.
The earnings reports that are being released from this week and last week will have a large impact on the market. If companies do not meet their earnings, then they will not inspire confidence in investors in the market and this will cause the market to shift downward. If companies can beat their projected earnings, though, the markets should start to thrive.
There are a few important companies releasing earnings in the next few days. Most notably are Sprint, eBay and the soccer club Manchester United. Twitter plans to release its second earnings reports since going public back in 2013. Last week, other companies including Netflix, Samsung, and SunTrust banks also released their earnings reports.
These are large factors in the marco-economy of our country, and if any one of these factors was to become unbalanced then it could have a large ripple effect throughout the economy. That is why it is important that all of these signs be properly interpreted by the investors and portfolio managers on Wall Street. If they are interpreted incorrectly, then it could cause our economy to start to spiral out of control.
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