Monday, July 29, 2002
Volatility continued to irritate investors as earnings season blossomed into full bloom. The week began with sell-offs in most markets followed here. This, in turn, was followed by a spectacular rally in U.S. markets at midweek. European indexes, which have lost the most since the beginning of the year, joined in the gains while Asian indexes went their own way, seemingly unaffected by the U.S. rally or decline. On the week, only the Dow was higher. The Dow's 488.95 increase on Wednesday was the second largest point gain ever behind 499.19 on March 16, 2000. On the year, the Nasdaq, DAX and CAC have been the big losers (all over 30 percent). Somehow, the South Korean Kospi has managed to stay above its 2001 year-end level, but barely (0.6 percent).
The Swiss National Bank continued its battle against the rising value of the Swiss franc. On Friday the bank cut its target for the 3-month Libor rate by 50 basis points to a range of 0.25-to-1.25 percent, citing weaker-than-expected economic growth and a tightening of monetary conditions caused by the Swiss franc's recent appreciation. Continuing economic and political uncertainties in the world economy have led foreign exchange traders to buy the Swiss franc (and gold) as a safe haven.
A down and up week
