20110811 market mayhem
An electronic display shows Dow Jones Industrial Average numbers on the floor of the New York Stock Exchange just after the closing bell on August 11, 2011. US stocks made another dramatic comeback after a stunning fall on Thursday, in another day of extreme volatility in markets around the world. - 

JEREMY HOBSON: So did something change in the past few days? Have hopes about Japan's economy made the world forget about the U.S. debt downgrade and the European debt crisis? Why do the markets seem to be recovering, somewhat, from last week's unprecedented volatility? Let's bring in our senior business correspondent Bob Moon to discuss that. Good morning, Bob.

BOB MOON: Good morning, Jeremy.

HOBSON: So, is the worst over?

MOON: Interesting question. Very interesting question. I can answer that in only four words: we can only hope. This actually follows some logic, though. We've got some good news this morning and early stock trading futures are signalling some gains today. I talked to Ted Weisberg, the head of Seaport Securities. He's worked on Wall Street for half a century -- so I asked him -- are things going to be calmer this week?

TED WEISBERG: I can't imagine that we would repeat last week, but having said that, I couldn't imagine that last week would have happened. I've never seen anything like what we saw last week, quite frankly.

HOBSON: But Bob, has anything changed, fundamentally? Or is this just a new week, everyone had a good weekend and that's the end of that?

MOON: Ah, you want to hear fundamentals? Well, again, maybe a 50-year veteran of Wall Street can answer that question about fundamentals, as well. Ted Weisberg told me this morning that with all the computer trading these days, reason doesn't always play out on Wall Street.

WEISBERG: Momentum seems to be everything, logic is left at the doorstep. When the computers take over, you just have to get out of the way and let things run their course.

MOON: Now the big question this week is going to be the way the news goes. Early retail sales figures were up last week. This week Wal-Mart reports its second-quarter earnings, and that could be a big indicator for back-to-school sales. Keep in mind Wal-Mart is the world's biggest retailer, and its sales in stores open at least a year have been lagging for two straight years now. Tomorrow, we get a gauge on the economic health of Spain, which is the fourth-largest economy in Europe. That's key to the financial troubles across that region. And then on Thursday, the weekly jobs numbers. After last weeks weekly jobs numbers, we saw Wall Street shoot up, so we can keep our fingers crossed.

HOBSON: Indeed. Marketplace's Senior Business Correspondent Bob Moon. Thank you, so much.

MOON: Thanks.