Tags: Cliff | Bungee | Jump | Stocks

Market Expert Guppy: Going Over Cliff Would Be ‘Bungee Jump’ for Stocks

Thursday, 06 Dec 2012 07:30 AM

 

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As the U.S. economy approaches the edge of the fiscal cliff, at least one technical analyst says tumbling off the edge would be a “non-event” for stocks.

The Standard & Poor’s 500 Index is not showing signs of stress at the prospect of $600 billion in tax hikes and spending cuts due to take effect next month unless lawmakers reach a deal, independent chartist Daryl Guppy told CNBC Asia’s “Squawk Box.”

"The fiscal cliff is a bungee jump,” he said. “It used to be exciting. Now it's just a tourist attraction. The market is absorbing that.”

Editor's Note: The ‘Unthinkable’ Could Happen — Wall Street Journal. Prepare for Meltdown

While the S&P 500 index has slipped toward the 1,380 to 1,400 range seen in August and, mostly recently, last month, stocks have rebounded. The index closed at about 1,409 on Wednesday.

Stock markets have been gyrating over the past few months as investors react to headlines on whether the cliff will be averted or not.

Treasury Secretary Timothy Geithner told CNBC this week the Obama administration was "absolutely" ready to go over the cliff if the Republicans fail to agree to raise tax rates on the wealthy.

Congressional Republicans and President Barack Obama spent much of Wednesday highlighting their positions on the fiscal cliff, according to Reuters.

Obama and Republican House Speaker John Boehner spoke by phone, but neither showed signs publicly of giving ground.

The phone call did not lead to the announcement of a face-to-face meeting, as had been anticipated all week and was requested earlier in the day by House of Representatives Republican leader Eric Cantor.

The White House, in its public relations offensive, is targeting the very “job-creators” Republicans say they are defending.

Obama met with The Business Roundtable to argue in favor of including tax hikes on the wealthiest 2 percent of Americans as part of a deal to avert the cliff, Reuters said.

Editor's Note: The ‘Unthinkable’ Could Happen — Wall Street Journal. Prepare for Meltdown


© 2014 Thomson/Reuters. All rights reserved.

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