Global markets dictated trend on the US stock exchanges last week. Global bourses witnessed alternate bouts of buying and selling caused by risk aversion or risk appetite that, in turn, was driven by how concerned the market was about the US subprime mortgage woes. As more and more institutions across the US got dragged into the subprime quagmire, the work markets continued to get affected by weak sentiments.

The Dow lost 387 points over the last thursday to close at 13,200 range. While large cap and mid-cap indices were in the red.  While we remain positive on the long-term outlook of the US Stock markets, yet short-term seems to be clouded by the subprime woes. Therefore, in the short run, the investor may stay on the fence till a clearer picture of how deep the subprime problem is known. Meanwhile, the volatility will continue to rule the roost.

Technical charts also indicate that short term may turn bearish if the Dow dips below 13,000.