Declines on Wall Street, Thursday amid more signs of strain on the factory floor and worries the trade war truce between the U.S. and China is on shaky ground.
All three major indices finished lower but well-above the lows of the day.
Manufacturing activity in the midwest fell in October to its deepest slump in four years, according to the Chicago Purchasing Managers Index.
The global manufacturing sector has been severely hampered by the 15-month trade war between Washington and Beijing.
Sam Stovall of CFRA Research makes the connection between Wall Street and trade: SOUNDBITE (ENGLISH) SAM STOVALL, CHIEF INVESTMENT STRATEGIST, CFRA RESEARCH, SAYING: "It's sort of a cascading effect, in the sense of about 50 percent of the revenues for the S&P come from overseas operations.
If you have a problem with a majority of your foreign markets, then that's going to artificially depress earnings and depressed earnings give less of a reason to want to bid up share prices.
So trade is the fulcrum of this see-saw." Thursday's reports sparked jitters ahead of Friday's important update on hiring.
Traders were further spooked by a Bloomberg report that Chinese officials doubt whether a wide-ranging long-term trade pact with Washington is possible.
Meanwhile, trying to keep confidence alive, President Trump said on Twitter, that after Chile canceled the APEC meeting because of domestic unrest, the U.S. and China will soon announce a new location where they will sign, what is being called phase one of their trade deal.
And that wasn't the only tweet from the President.
He once again criticized Federal Reserve ChairmanJerome Powell for keeping rates too high and for putting the U.S. at a "competitive disadvantage." Trump is still unhappy even though the Fed has cut rates three times this year.
Wall Street rallied to close sharply higher on Monday as investors sought bargains among sectors hardest-hit by the coronavirus recession, now limping toward its ninth month. This report produced by Yahaira Jacquez.
Wall Street's main indexes closed lower on Monday as concerns about new lockdowns in Europe and possible delays in fresh stimulus from Congress raised fears the U.S. economy faces a longer road to recovery than previously hoped for. Fred Katayama reports.
Wall Street's main indexes hit their lowest in nearly seven weeks Monday as concerns about fresh coronavirus-driven lockdowns and the inability of Congress to agree on more fiscal stimulus raised fears about another hit to the domestic economy. Fred Katayama reports.
The United States appears to be getting on China's very last nerve. That is, if the remarks made by China's Ambassador to the United Nations on Thursday truly reflects Beijing's sentiments. According to CNN, at a tense meeting of the UN Security Council, Zhang Jun said Thursday that the US has 'created enough troubles for the world already.' Zhang Jun's comments was a retort to US Representative to the UN Kelly Craft, who accused China of hiding the virus's origin and minimizing its danger.
A protest was organised against China outside the United Nations office in Geneva, Switzerland. The 3-day long demonstration, consisting of a photo exhibition, was organised by a group called the World Uyghur Congress. It was titled 'Made In China = Uyghur Forced Labour'. The protestors accused the Chinese government of forcing the Uyghurs, a Muslim minority group in the country's northwest Xinjiang province, into forced labour and even attempting a genocide. Beijing has allegedly been trying to stamp out the community's religious and cultural identity in order to assimilate it more fully into the majority Han Chinese community. Dolkun Isa, president of the World Uyghur Congress, sought international pressure on China to stop the Uyghurs' persecution and boycott by international companies to prevent forced labour. Watch the full video for more.
Credit: HT Digital Content Duration: 02:14Published
On Thursday, US stocks fell 320 points. The drop comes even as weekly jobless-claims data came in better than expected. Business Insider reports that weekly jobless claims fell by more than 30,000 from the previous week, to 860,000. Tech stocks led the decline. Investors continued to process Federal Reserve Chairman Jerome Powell's comments expressing uncertainty about the economic recovery. Powell also said the Fed didn't expect to raise interest rates until at least 2023.
On Thursday, the S&P 500 extended its record highs. Federal Reserve Chair Jerome Powell spoke at this year's virtual Jackson Hole symposium. Business Insider reports that Powell outlined the central bank's overhauled strategy for controlling inflation and avoiding future crises. He also signaled that the Fed's monetary policy will remain accommodative as it seeks to stimulate the US economy. Jobless claims came in at 1 million for the week that ended on Saturday, in line with consensus estimates. Abbott Laboratories produced a COVID-19 test that received emergency use authorization from the Food and Drug Administration. Oil prices traded lower. West Texas Intermediate crude fell as much as 2.4%, to $42.36 per barrel.
The Federal Reserve is targeting above 2% inflation. Scott Minerd, Guggenheim global CIO told Bloomberg on Wednesday it is "virtually impossible" for the Fed to achieve that without creating a bubble in asset prices. "The reality is that the inefficiencies that are building up in the system." Minerd said misinformation and mistaken investments will pose a challenge to investors.
Equity benchmark indices traded lower during early hours on Thursday on the back of weak global cues after the US Federal Reserve indicated the interest rate could stay close to zero for years. At 10:15 am, the BSE S-P Sensex was down by 141 points or 0.36 per cent at 39,162 while the Nifty 50 lost by 39 points or 0.34 per cent at 11,565. Except for Nifty IT and pharma, all sectoral indices at the National Stock Exchange were in the negative terrain with Nifty private bank losing by 1 per cent and financial service by 0.9 per cent. Among stocks, ICICI Bank dropped by 1.3 per cent to Rs 369.85 per share while HDFC Bank lowered by 1 per cent. The other major losers were Hindalco, Tata Consultancy Services, Bajaj Auto and Tata Motors.However, HCL Technologies moved up by 2 per cent to Rs 811.20 per share and Tech Mahindra by 1.7 per cent. Dr Reddy's, Hero MotoCorp, Grasim and Asian Paints also traded with a positive bias.
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