On the first trading day after the rating agency Standard & Poor's downgraded the U.S. credit rating late last Friday, the markets went wild with investors rushing to pull out their bet on the equity markets. On Monday, the S&P 500 and Nasdaq Index both plunged over 6 percent and the Dow lost 634.76 points. The CBOE Volatility Index, which is regarded as the best gauge of markets' fear, jumped 50 percent to 48.00 on Monday, the figure's first leap above 40 since May 2010. Although Tuesday's market rebounded quite a lot with three major indexes jumping over 3 percent, stocks tumbled again on Wednesday as investors were concerned about the slowing economy and rumors said France might be the next to lose its triple-A credit rating. All three major indexes fell more than 4 percent. Meanwhile, gold was pushed higher due to strong risk-aversion appetite. Gold futures rallied and hit a record high of 1800 U.S. dollars an ounce on Wednesday. The precious metal surged 5.5 percent this week. Out of expectation, stocks rose sharply again on Thursday, with three major indexes surging over 3 percent and traders said it was due to a "technological correction." Then Friday's market again beat everyone's expectation. The Dow rose over 1 percent and the market closed higher for the second consecutive day. "All I can say is, this is a crazy world." New York Stock Exchange trader Joseph Yong told Xinhua. CONCERNS OVER ECONOMY REMAIN With the downgrade issue fading away, investors now pay more attention to the economic situation. Some of them hold positive views toward future markets and believe shares such as technological ones will have a good return. The Federal Reserve decided Tuesday to maintain its ultra-loose interest rates for at least another two years and hinted to take more measures if the economic condition requires. The central bank's pledge helped shore up the markets as the Dow soared more than 600 points in last hour trading on Tuesday. However, on Wednesday, rumors spread in the markets that France might lose its triple-A credit rating, which raised investors' concerns about the European country's debt health and triggered a sell-off of French banking shares. As for employment, the U.S. Labor Department said on Thursday that the number of people filing for unemployment benefits for the first time fell 7,000 to 395,000 last week. It was the first time for weekly data to dip below 400,000 in four months, indicating an improving job market and offering comfort to anxious investors. However, the U.S. trade deficit widened to 53.1 billion in June, the largest since October 2008. Both imports and exports declined as global demand slowed, the U.S. Commerce Department said Thursday. "The retail numbers are good but the confidence number is horrible," David Yan, head of CDO Research of Credit Suisse, told Xinhua. "I think there is enough evidence suggesting a significant slowdown, but whether there will be another recession or not is still unclear -- I personally doubt it," Yan said. Yan favored tech stocks, especially big-cap names with strong balance sheet, and other high dividend stocks with reasonable valuations. He added that he did not think people would necessarily reduce exposure to stocks, although that is contingent on whether the U.S. economy will have another recession. Ralph Acampora, director of tactical investments at Altaira Wealth Management, holds bullish opinions and believes right now is a good opportunity to buy.

Xinhua