Market Overview

Where Is The Market Headed?

Where Is The Market Headed?
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Last week was filled with peaks and dips as share markets responded to panicky investors worried about the state of the global economy. The Dow Jones Industrial Average had its largest intraday point decline in history, followed by its largest two-day gain ever.

While many hope markets will start fresh this week, Monday appeared to set the stage for more volatility in the week to come.

No Change In Circumstances

While the initial shock of "Black Monday" has faded, many analysts say they expect to see more of the same market swings this week, as the underlying reasons for uncertainty remain.

China will likely continue in the spotlight as investors watch closely for any sign that the nation will be able to pull itself out of its economic rut. Worries about the U.S. Federal Reserve's rate hike are also heavy on traders' minds, as are concerns about oil markets as demand slows coming out of the summer.

Related Link: More To Come On The Oil M&A Front, Says Morgan Stanley

Further Decline?

Last week's rollercoaster ride ended with a rebound, giving some traders hope that markets weren't doomed. However, many analysts are advising shareholders to abandon their positions and use the rally as a chance to sell, as they see markets falling even lower in the weeks to come. Some foresee stocks losing over 20 percent in the coming weeks.

Any Winners?

In such an uncertain market, there are few sure bets for investors still looking to trade. Many have turned to trading firms like Virtu Financial Inc (NASDAQ: VIRT) and KCG Holdings. Inc. Class A (NYSE: KCG), as their businesses depend on trading fees.

Since the companies profit from fees paid on every trade, the firms are able to remain profitable in a rapidly changing market no matter which direction prices are moving. The increased volume of trading has also benefitted exchanges like CME Group Inc (NASDAQ: CME), whose trading volume has risen to 20 million futures contracts from its average of just 13.9 million contracts per day.

Image Credit: Public Domain

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