Wall Street

by Barry Wood

Online Stock Market Trading An increasing number of analysts are predicting prices will stay high, a worrying development that could slow global economic growth.

Middle Eastern governments are demonstrating their clout in global financial markets as oil prices soar. Foreign Owners May Drive U.K.'s Success Prime Minister Gordon Brown's open investment policy runs counter to more protectionist stances in the U.S. and much of Europe. Backers credit it with spurring growth, term cost.

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Dollar gains yesterday were also supported by the declining oil prices that hit a 19 month low yesterday. Due to the comfortable weather and the overall declining demand for oil products, crude oil is currently trading around a barrel. Lower energy costs are considered positive for economic growth as they constitute a sizable portion of overall inputs prices. This allows manufacturers to lower prices and consumers to buy more.

Stock Market Game Oct 29, 2004 (AXcess News) New York - Although global oil prices have fallen back from the soaring levels of earlier this week, they remain far higher than they were just one year ago. An increasing number of analysts are predicting prices will stay high, a worrying development that could slow global economic growth.

Our base case scenario, based on a global "soft landing", of slower but still solid 4.5% real domestic GDP growth in both 2007 and 2008, accompanied by sideways interest rate moves for most of the period, is a fairly positive environment for the residential property market. Even a mild interest rate hike, which would assumedly take place under a fairly healthy economic growth scenario, would not be too problematic for the property market.

Stock Investing Game Less than a month ago the International Monetary Fund said the world economy was in its best condition in over 20 years. IMF forecasters said the world economy was likely to continue to expand at a four to five percent rate well into next year.

Stock markets across Asia fell Tuesday, tracking Wall Street's decline on renewed concerns about the crisis in credit markets and worries that record oil prices will dampen consumer spending in an already slowing economy.

Journal Prime Rate Street Wall But the IMF assumed that oil prices would retreat slightly from the $45 level that prevailed in late September. Since then, instead of falling back, prices have risen another 20 percent to near $55 a barrel.Oil analyst Philip Verleger, who spoke Thursday at Washington's Institute for International Economics, says prices are likely to stay high because of soaring demand, particularly from India and China.

However, economists at Freddie Mac estimate that home price appreciation across the U.S. will slow down as interest rates rise next year. This slowdown will have an impact on economic growth. Over the past three years, home prices have risen more than twice as fast compared with wages. According to government data, personal income rose by 9.3 per cent from 2001 onwards, whereas prices for homes rose 19 per cent in the same period.

Stock Market News "Today the story is India and China," he said. "Their consumption since 1990 has been growing at a seven percent rate and total world consumption has been growing at a one point three percent rate. And if you take out China and India, world growth is only eight-tenths of one percent."Mr. Verleger says the increased demand from China and India has boosted world demand for oil by four million barrels a day.AdvertisementAnother analyst, Brian Hicks in San Antonio, Texas, agrees that prices are likely to remain high. He tells Bloomberg news that it is unlikely that the United States will comply with OPEC's call that Washington should help depress prices by releasing oil from its strategic petroleum reserve.

Stock Investing Basics "No, I don't think that is at all likely," said Mr. Hicks. "I think if President Bush were to release oil from the SP [strategic petroleum] reserves, he probably would have done so already."

Stock Investing Software Some economists say the near doubling of oil prices this year will slow economic growth but not by enough to trigger a recession. Other economists say if prices remain in the $50 per barrel range, the danger of recession is very real.

Stock Market Trading Source: Voice of America

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