Wall Street Improves as Congress Meets on the Fiscal Cliff

On Monday, November 19th the DOW Jones Industrial average rose by 207 points and the S&P gained 2%, marking the second day of improved performance for Wall Street after a 5.3% drop of the S&P index after Election Day. The likely result of this improvement is lawmakers coming together to discuss the fiscal cliff, an imminent financial threat to investors and consumers alike.

In the words of Jeff Morris of Standard Life Investments, “”Constructive comments over the weekend are key for the market to feel like, in this postelection environment with all the intense partisan politics, the two parties will be able to get together to avoid the fiscal cliff that would put the economy back in contraction.”

The cliff, set to be reached on January 1st, 2013 will result in staggering tax increases coupled with extreme spending cuts if Congress and the executive do not find a resolution. The pressure of this situation and the post-election daze coupled with controversial European debt negotiations has negatively impacted the domestic financial outlook.

Nevertheless, several companies have claimed gains since Friday, including the top two achievers Lowe’s and Tyson Foods with a 6.2% rise and 7.8% respectively. Intel, however, saw a loss of .04% due to the retirement announcement of current CEO Paul Otellini who will step down in May. Hopefully in the coming weeks before the New Year, Congress can sit down and find a bipartisan solution to the impending crisis not only for the sake of Wall Street stocks, but for all Americans.

Posted by: Sophia Higgins

Sources: Reuters, Wall Street Journal, New York Times

Photo credit: Rep. Charlie Bass, R-NH @ photostream courtesy of Flickr user Talk Radio News Service


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