More bad news came our way this week in terms of the economy.
Fourth-quarter gross domestic product fell 3.8 percent, making for the worst showing since 1982 and a blow to any hopes that 2009 is going to be coming up roses.
President Barack Obama said the poor economic news was another reason that it’s important an economic stimulus package is passed quickly.
The Dow Jones Industrial Average had been working to climb off that 7,900 level, but after the lackluster GDP news, it closed Friday right at 8,000 — far from the 14,100 record level set in October of 2007.
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According to the Wall Street Journal, last month was the worst January the Dow Jones every experienced in its 113-year history.
It lost 8.84 percent for the month and saw its fifth consecutive month of declines, the newspaper reported.
“Smart investors are sitting on the sidelines,” David Henderson, president of Raven Securities, told the Journal. “There’s not much conviction one way or the other.”
More and more ads are showing up on TV appealing to the frugal side of us consumers.
Whether it’s the woman in the grocery store sawing every item in half for affordability’s sake (except the Velveeta) or Wal-Mart telling us how much we can save by eating frozen dinners rather than going out, the prevailing consciousness is saving money at the moment.
And that’s not good for stocks.
Despite the recent rottenness, Investor’s Business Daily still put a border around one of its stock charts this week, signifying the newspaper believes the stock might be a good buy right now.
That stock is Gilead Sciences (GILD), a company that makes therapies and treatments for HIV and other viral diseases.
Gilead has a three-year earnings-per-share growth rate of 35 percent and a three-year sales growth rate of 38 percent, according to IBD.
The company is also about to benefit from China introducing its Viread HIV drug to patients in that country.
Back when things were rocking along, a given edition of IBD might have seven or eight stocks highlighted each day as possible buys.
But with the state of the market, it’s not surprising that there is only one.
There was some brighter news on the retail front this week.Amazon.com (AMZN) saw its profit rise 9 percent in the fourth quarter. Sales grew 18 percent during the same period. The results from the online retailer beat expectations by Wall Street.
But the company has a lot of lost ground to make up.
Amazon’s year high was $91.75. Currently, it’s trading in the $58 range.