Wall Street Braces for New Round of Reports
STEVEN INSKEEP, host:
We'll find out if the stock market is growing of shrinking this week. Investors are bracing for what could be another volatile time because the government will release some key economic data, including the unemployment report.
NPR's Jim Zarroli reports.
JIM ZARROLI: Technically speaking, the U.S. economy may not be in a recession yet, but whatever's happening isn't pretty to watch. On Friday came reports suggesting just how big a toll the slowdown was having. Consumer sentiment hit a 16-year low, and consumer spending slowed to a crawl. The result was another big drop in stock prices. The Standard & Poors 500 index is now down 15 percent since its high last October.
Whether stocks drop some more this week will depend on several closely followed economic reports. They include new data on manufacturing, the service sector and home sales, not to mention Friday's jobs report. Investors will also be listening closely when Fed Chairman Ben Bernanke addresses a banking group in Florida tomorrow for some hint of where interest rates are headed.
One potential landmine for the economy is the perilous health of the nation's bond insurance firms, which play a central role in the financing of state and local governments. There have been various efforts to bail out the firms, but on Friday, CNBC reported that efforts to rescue one of the biggest firms, Ambac, may have hit a snag. The firm is now at risk of being downgraded by credit rating agencies, something that would only deepen investor gloom about the state of the credit markets.
Jim Zarroli, NPR News, New York.