The Spiraling Stock Market And Increasing Penny Stock Opportunities: The Worst Week Of The Year

It is been a wild and woolly couple of weeks on the international stock markets. Is the recent slide grinding to a stop or just taking a breather just before tumbling some a lot more? And more to the point, what does it mean to astute penny stock investors?

Wall Street recently stumbled to its worst week of the season, and global stock markets fell dramatically on concerns about rising interest rates and slowing growth. Immediately after rising nearly 9% in the initial 4 months of the year, the Dow Jones industrial average has fallen about 6% from a six-year high.

Stocks have been ailing simply because penny stock investors fear the Fed could be so focused on inflation that it disregards signs of an economic slowdown, raises interest rates too high and sends the economy into a recession.

Global stock markets had been sent reeling last week right after golden-tongued Federal Reserve Chairman, Ben Bernanke surprised penny stock investors in saying the Fed will keep on raising interest rates to keep inflation in check.

And that decision will have a direct impact on the penny stock market. Greater interest rates hurt penny stock prices because investors think it is going to curb economic progress and corporate earnings.

But why is inflation heating up? Higher energy costs. Traders and penny stock investors are also worried that with the hurricane season officially under way, Gulf Coast refineries and oil production websites could be damaged again this summer and fall.

And greater interest rates have the capability to impact the whole economy. Finance charges on credit cards will rise. So too will rates on mortgages and home equity loans, putting extra pressure on home buyers and a softening housing market. Ultimately, it's going to cost much more to borrow for expansion.

But does that signal doom-and-gloom for the penny stock industry? While the temptation to sell everything can be overwhelming, some see this as a terrific opportunity. "I would not be selling. I would often be purchasing," stated one New York analyst.

So just how is this an opportunity for a money raise? It just so happens that numerous companies caught within the market's downward spiral are cheaper than they were a few weeks ago.

And as any professional penny stock investor will tell you, acquiring a terrific penny stock when it is been beaten down isn't a bad way to make money and increase business capital over the long haul.

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