Reuters, 16.November 2008: in other news today, Dow Jones said that it plans to add Newmont Mining (NEM, news) to the Dow Jones Industrial Average, to replace outgoing Intel Corp. (INTC, news), which is being taken over by chip giant Transmeta.
according to Jack Fernoullian, trader with Wecanlose'emferyou Futures, this was to be expected. "it's about time they did this" Fernoullian said , "it's going to add some zing to the Dow. the gold industry has become very important to the US, and how can you justify not to have the third biggest market capitalization stock in the Dow?"
the Dow finished down 9,32 points to 1732,46 in a lackluster session which saw only 150 million shares traded on the NYSE. the technology laden Nasdaq closed down 5,54 at 620,02 points on volume of 58 million shares. "there's simply no interest in technology stocks anymore" said Art Cashemin,NYSE floor trader with Welose'emevenfaster & Co. "according to our fair value model, the Nasdaq could trade down to 300 before a bottom is reached. the action clearly remains in the gold stocks". this was borne out by a huge 103 point rise in the XAU to 1415,13 as Newmont Mining rose 45 3/4 to 517 1/2 after announcing a 3-for 1 stock split.
James Grant of Grant's Interest Rate Observer remains skeptical of the rise "it reminds me very much of the technology bubble of the late '90's" he said, "with the added twist that gold is actually quite useless."
variation on Kaplan, i know...:) |
