The major stock indexes have declined faster than they rallied after the announcement of the Bank of America deal with angel investor Warren Buffett. At first, many traders and investors thought this was good news, now it is really turning out to be a negative report for the investing public. This shows the world that perhaps even the banks in the United States may need more capital. All of the leading financial stocks have faded from their gap higher open. Stocks such as J.P. Morgan Chase & Co. (NYSE:JPM), and Goldman Sachs Group Inc. (NYSE:GS) have given back most of the early morning gains. Leading tech stocks such as VMWare Inc. (NYSE:VMW), and Amazon.com Inc. (NASDAQ:AMZN) are also under some selling pressure.
Tomorrow, the Federal Reserve Chairman Ben Bernanke will speak in Jackson Hole, Wyoming. More pressure than ever will be on Chairman Bernanke to try and say something to help prop this market up. It was just one year ago that Chairman Bernanke signaled to investors that he would do another round of quantitative easing coined QE-2. That QE-2 program ended just ended in June, and it is unlikely that Chairman Bernanke will announce another round of quantitative easing.
Many traders seem to be are taking profits off the table this morning since they know that Bank of America was in worst shape then originally thought. We can only wonder what will be said tomorrow and more importantly how the market will react after the Bernanke speech.