The FINANCIAL — Wall Street is in for a volatile week as escalating problems in Europe's debt crisis continue to keep investors on their toes.
Wall Street is in for a volatile week as escalating problems in Europe's debt crisis continue to keep investors on their toes.
With light trading volume expected this week due to the US Thanksgiving holiday on Thursday, intraday swings are likely to be wide and frequent as traders instantly react to headlines out of Europe.
In addition, a 12-member "super committee" in Congress has until midnight on Wednesday to strike a deal involving tax increases and spending cuts to rein in federal spending. Investors are concerned that failure to reach a deal would result in automatic reductions that would harm the fragile recovery.
But with Wall Street poised for a technical rebound after finishing the worst week in two months, some say there are a lot of variables that could spark a rally.
If the super committee can come up with a workable deficit-reduction plan and if progress can be made in Europe, "the stage could be set for a fourth-quarter rally that might surprise even the most bullish traders," said Randy Frederick, managing director of trading and derivatives for Schwab in Austin, Texas.
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