CNN 2011-08-13

 Wall Street did a bit of a U-turn yesterday and thank goodness it did. We don't know exactly what it's going to do today. But we're waiting to see. And that's coming up for us in just about 29 minutes from now. But the Dow closed up 429 points yesterday. However, that was a reversal of fortunes from Monday's loss of 634 points.  

 
Christine Romans in New York for us. Alison Kosik at the New York Stock Exchange for us.  
 
Christine, 29 minutes away. What is going to happen?  
 
Well, futures 1 are lower and Alison can tell you more about that. But really you've got a market the day after a prehistoric 2 Fed decision trying to figure out what it's going to do next, what investors 3 are going to do next. They're still weighing the risk of we're just a rut or this is going to be another recession.  
 
The Fed's decision yesterday was to keep interest rates, TJ, low through 2013. Putting a date on it. That was the news. Found weakness in the economy and jobs, housing and spending, and said things were weaker than they had thought even a few months ago, but also said that they have a range of policy tools.  
 
That's code word, key word for we're going to keep rates really, really low but if we have to do something we might be able to do it. We will be able to do it and it's that, you know, one, two, three, four words right there, that was one of the reasons why things really got going on the upside yesterday.  
 
But you got to be careful here because we still have a lot of people talking about how bad it feels in the economy and does this big stock market rout 4 of the past few days says it set the stage for more weakness in the economy and just how weak will it get.  
 
So I predict treacherous 5, treacherous politics and treacherous, treacherous markets over the next days and weeks -- TJ.  
 
All right. Alison, you heard her say treacherous markets possibly over the next days and weeks. We're just trying to go day- to-day right now. And on this day, at least, you're keeping your eye on the futures.  
 
Where do we stand possibly when this thing opens in a few minutes?  
 
It looks like we're going to start with losses, TJ. In fact, those losses accelerated just over the past few minutes. The Dow could open down more than 100 points lower. And this, despite that, you know, we're seeing gains that happened overseas.  
 
Take a look. We saw gains in the Asian and European markets up 1 to 2 percent. You know what we're really trying to see what happens, you'll see sort of this high turn if you wind up -- if you wind up getting smaller gains and losses at the close because that would wind up showing that the market is trying to find some equilibrium 6, some balance. Trying to find its footing.  
 
And you have to admit these price swings are just dizzying that we've seen lately. You know they're huge and they're happening a lot. So we really want to see the market have smaller gains and losses throughout the session and especially at the close of the session.  
 
You look at yesterday. The Dow crossed back and forth 7 over the break even point. More than 30 times yesterday and analysts 8 say guess what? We're going to continue to see these big moves in both directions. And despite yesterday's rally, we are still seeing signs of weakness in the economy overall.  
 
Oil plunged 9 below $80 a barrel yesterday. It's good for our pocketbooks but it's also a sign of a slowing economy. Now it is coming back just a bit today but it is just a relief rally. I'm talking about oil. Now we're also watching yields of 10-year Treasury 10 bonds. TJ, they hit a record low. That's considered a safe haven 11. It's good news for us who have mortgages because that's where our mortgage rates are really based on. This is mostly a reaction to the Fed saying it's going to keep interest rates low another two years.
 
In London now. The British Prime Minister David Cameron is vowing 12 to restore order to the streets after young people have gone out for a fourth night of rioting.
 
Our Phil Black is live at London Scotland Yards.
 
Phil, good morning to you.
 
And some pretty strong words from the prime minister.
 
Yes, indeed, very strong words from the prime minister, T.J. He says fight back is now under way and so, he is very keen to show that he is once again in charge of Britain and the British police, once again, ruling the streets. And so, we've had over the last few nights now, more than 700, approaching 800, arrests in London alone. Hundreds more in other cities as well.
 
The prime minister, the government and the police here at Scotland Yard are promising 13 that is going to continue in two-forms. In the form of a more robust 14 approach to deal with the rioters if they continue with this sort of behavior as they run out of control on the streets. Last night, a surge of around 10,000 more police on the streets of London and the prime minister says that has made a real difference with the relatively 15 calm night here.
 
And on top of that, hundreds of officers are now going through thousands of hours of CCTV video to try to track down the people they say were responsible for this. They say those arrests are already being made -- T.J.
 
Phil, you said a little quieter night there in London, but how much of a concern is it that it has spread to a few other cities outside of London?
 
Yes, it's a good point. The momentum 16 seems to have broken here in London for the moment. But you're right. It has spread to other major cities, including Birmingham, Manchester, Nottingham, among others. We've seen some big scenes of real violence there and hundreds of arrests just overnight.
 
So, the challenge continues if you like, and the British prime minister says that all police battling this, whether it be here in London or in those other cities, will have everything they need to bring it under control.
 
All right. Phil Black for us in Scotland Yard -- Phil, appreciate you as always. Thanks so much