It’s been a wild and wooly couple of weeks on the international stock markets. But could be the recent slide grinding to some halt. or just getting a breather just before tumbling some a lot more? And a lot more importantly, what does it mean to astute penny stock traders?

Wall Street recently stumbled to its worst week of the year, and global stock markets fell dramatically on concerns about rising interest rates and slowing growth. After rising almost 9% in the initial four months with the year, the Dow Jones industrial average has fallen about 6.5% from a six-year substantial, reached May 10, 2006.

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

Global stock markets were sent reeling last week following golden-tongued U.S. Federal Reserve Chairman, Ben Bernanke shocked penny stock investors in saying the Fed will continue raising interest rates to maintain inflation in check.

And that decision will have a direct impact for the penny stock market. Higher interest rates hurt penny stock prices due to the fact traders believe it will curb economic growth and corporate profits.

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

And higher interest rates have the ability to affect the entire economy. Finance charges on credit cards will rise. So too will rates on mortgages and home equity loans, putting additional pressure on homebuyers and a softening housing industry. Ultimately, it will price a lot more to borrow for expansion.

But does this signal doom-and-gloom for the penny stock marketplace? Au contraire. While the temptation to sell everything can be overwhelming, some see this as a great chance. “I would not be selling. I would tend to be buying,” said 1 New York analyst.

So how precisely is this an possibility? It just so happens that several companies caught in the market’s downward spiral are cheaper than they were a handful of weeks ago. And as any seasoned penny stock investor will tell you, buying an excellent penny stock when it’s been beaten down isn’t a bad way to make cash above the long haul.

If you can stomach some of the volatility which is. While many blue chip traders have difficulty handling the market’s unpredictability. it’s par for the course.

So, “snap out of it,” said one more watcher. A month of dizzying selling has brought the markets into an attractive range. Is it possible the markets will fall a lot more? Absolutely. Following all, no penny stock is really a sure thing. But 1 thing is certain: “Stocks are a lot cheaper now than they were two months ago.”

You can find more information about stock scanner, penny stock finder, and stock market investment software

Technorati Tags: , , ,