Tag Archives: market

Pound slips below $1.25 on disappointing growth data

By Maiya Keidan

LONDON (Reuters) – Sterling fell below $1.25 on Tuesday for the first time in a week and reached a 14-day low against the euro after data showed Britain’s economy was recovering more slowly than forecast.

Gross domestic product rose by 1.8% in May after falling by a record 20.8% in April, the Office for National Statistics said, well below forecasts in a Reuters poll.

“You saw sterling moving lower almost immediately after the announcement and it was a big disappointment and I think that it’s also the realization that maybe the V-shaped recovery doesn’t apply to the UK to the same extent,” said Morten Lund, an analyst at Nordea.

Adding to fears was a warning from authorities that another, more deadly COVID-19 wave could kill up to 120,000 Britons over the winter.

The pound touched a low of $1.2485, down 0.5% on the day. It slipped 0.7% to the euro at 91.03 pence.

Broad dollar weakness has allowed sterling to gain around 0.7% versus the greenback this month but against the euro it has lost 0.5% since the start of July.

Consumer data also indicated a tentative recovery. The British Retail Consortium said retail sales values rose by 3.4% in annual terms in June, and Barclaycard said overall consumer spending fell 14.5% in annual terms in June, the smallest decline since lockdown began.

Money markets price in the Bank of England’s cutting rates below 0% only next March. But government two-year bond yields plumbed a record low around minus 0.16% and 10-year yields slipped 2.5 basis points to 0.14%.

FTSE mid-cap shares, which tend to be mostly domestically oriented, fell 1.6% versus a 0.6% decline for the exporter-laden FTSE100.

Investors are also waiting for more news on Britain’s negotiations with the European Union on concluding a trade deal for the post-Brexit period. Britain left the bloc on Jan. 31, with a one-year transition period to iron out a future relationship.

“My feeling is the market is not fully pricing in the likelihood of a hard Brexit,” said Colin Asher at Mizuho.

“There has been very little progress on negotiations and even if there is a deal, there’s not much time to put a lot in it.”

(Reporting by Maiya Keidan, editing by Larry King and Ed Osmond)

U.S. Stock Markets Bounce Wall Street recovers after historic falls

A trader reacts on the floor of the New York Stock Exchange in New York, U.S., February 6, 2018.

By Tanya Agrawal

(Reuters) – U.S. stock markets bounced after a torrid opening on Tuesday, bargain-hunters and gains for Apple pushing the tech-heavy Nasdaq and the Dow Jones Industrial Average into positive territory after two days of heavy losses.

Both the S&P 500 and the Dow sank more than 4 percent on Monday, their biggest falls since August 2011, as concerns over rising U.S. interest rates and government bond yields hit record-high valuations of stocks.

New York’s three main indexes sank as much as 2 percent on the opening bell but they quickly moved back into positive territory.

An almost 2 percent gain for Apple was at the heart of an almost half percent gain for the Nasdaq Composite.

“Daily drops of 3 percent or more have been buying opportunities for the S&P 500 post financial crisis,” said Lori Calvasina, head of U.S. equity strategy at RBC Capital Markets.

At 9:49 a.m. ET (1449 GMT), the Dow Jones Industrial Average gained 0.25 percent to 24,406.14. The S&P 500 rose 0.2 percent to 2,654.25 and the Nasdaq 0.4 percent to 6,993.47.

(Reporting by Tanya Agrawal; Editing by Arun Koyyur and Patrick Graham)

U.S. Stocks plunge in highly volatile trading: S&P 500 erases 2018’s gains

A trader watches his screens on the floor of the New York Stock Exchange in New York, U.S., February 5, 2018.

By Lewis Krauskopf

(Reuters) – U.S. stocks plunged in highly volatile trading on Monday, with the Dow industrials falling nearly 1,600 points during the session, its biggest intraday decline in history, as investors grappled with rising bond yields and potentially firming inflation.

The benchmark S&P 500 and the Dow suffered their biggest percentage drops since August 2011 as a long-awaited pullback from record highs deepened.

The financial, healthcare and industrial sectors fell the most, but declines were spread broadly as all major 11 S&P groups dropped at least 1.7 percent. All 30 of the blue-chip Dow industrial components finished negative.

With Monday’s declines, the S&P 500 erased its gains for 2018 and is now down 0.9 percent in 2018.

Many investors have been bracing for a pullback for months, as the stock market has minted record high after record high with investors encouraged by solid economic data and corporate earnings prospects, the latter bolstered by recently passed U.S. corporate tax cuts.

Friday’s January jobs report sparked worries over inflation and a surge in bond yields, as well as concerns that the Federal Reserve will raise rates at a faster pace than expected.

“The market has had an incredible run,” said Michael O’Rourke, chief market strategist At JonesTrading In Greenwich, Connecticut.

“We have an environment where interest rates are rising. We have a stronger economy so the Fed should continue to tighten … You’re seeing real changes occur and different investments are adjusting to that,” O’Rourke said.

The Dow Jones Industrial Average fell 1,175.21 points, or 4.6 percent, to 24,345.75, the S&P 500 lost 113.19 points, or 4.10 percent, to 2,648.94 and the Nasdaq Composite dropped 273.42 points, or 3.78 percent, to 6,967.53.

The S&P 500 ended 7.8 percent down from its record high on Jan. 26, with the Dow down 8.5 percent over that time.

Even with the sharp declines, stocks finished above their lows touched during the session. At one point, the Dow fell 6.3 percent or 1,597 points, the biggest one-day points loss ever, as it breached both the 25,000 and 24,000 levels during trading.

The stock market has climbed to record peaks since President Donald Trump’s election and remains up 23.8 percent since his victory. Trump has frequently touted the rise of the stock market during his presidency.

As the stock market fell on Monday, the White House said the fundamentals of the U.S. economy are strong.

The CBOE Volatility index, the closely followed measure of expected near-term stock market volatility, jumped 20 points to 30.71, its highest level since August 2015.

Until recently, gains for stocks have come as the market has been relatively subdued, and any declines were met with buyers looking for bargains.

“People who have been buying the dip are now going to be selling the rip,” said Dennis Dick, a proprietary trader at Bright Trading LLC in Las Vegas. “The psychology of the market changed today. It’ll take a while to get that psychology back.”

About 11.5 billion shares changed hands in U.S. exchanges, well above the 7.6 billion daily average over the last 20 sessions.

Declining issues outnumbered advancing ones on the NYSE by a 8.64-to-1 ratio; on Nasdaq, a 6.92-to-1 ratio favored decliners.

The S&P 500 posted 1 new 52-week highs and 38 new lows; the Nasdaq Composite recorded 17 new highs and 164 new lows. 37.32

(Additional reporting by Megan Davies, Sinead Carew, Caroline Valetkevitch and Chuck Mikolajczak in New York, Noel Randewich in San Francisco and Tanya Agrawal in Bengaluru; Editing by Arun Koyyur and Nick Zieminski)

Wall Street opens lower amid Russia probe, Fed pick

Morning commuters are seen outside the New York Stock Exchange, July 30, 2012.

By Sruthi Shankar

(Reuters) – Wall Street opened lower on Monday, pulling back from a strong rally last week, as investors assessed the fallout of the first charges in connection with a probe into possible Russian meddling in the 2016 U.S. presidential election.

Paul Manafort, a former campaign manager for Trump, surrendered to federal authorities in connection with the investigation, according to reports.

“The market could be awakening to the fact that the political situation is coming back into focus … that could cap the market from moving higher,” said Peter Cardillo, chief market economist at First Standard Financial.

The ongoing investigation and its outcome could distract the administration from its efforts to overhaul the tax system and push through other policies, analysts have said.

Investors also awaited the announcement on the nomination of the new Federal Reserve chief, expected later this week. Trump is leaning toward nominating Fed Governor Jerome Powell, considered a moderate, to be the next Fed chair, sources told Reuters.

“This is a very heavy week in terms of macro news. While earnings continue to pour in, majority of the market is now going to focus on the Fed,” Cardillo said.

A Commerce Department report showed consumer spending recorded its biggest increase in more than eight years in September, but underlying inflation remained muted.

With the third-quarter earnings season more than half-way through, nearly 74 percent of the S&P 500 companies that have reported earnings so far have topped profit expectations, compared with 72 percent overall the past four quarters.

Blockbuster tech earnings last week powered Nasdaq to its best day in nearly a year. Apple and Facebook are among the top tech companies reporting this week.

At 9:55 a.m. ET, the Dow Jones Industrial Average was down 40.68 points, or 0.17 percent, at 23,393.51, and the S&P 500 was down 3.61 points, or 0.139864 percent, at 2,577.46.

The Nasdaq Composite, however, was up 13.63 points, or 0.2 percent, at 6,714.89, helped by Apple and Facebook.

Apple rose 1.8 percent as GBH Insights analyst Daniel Ives raised his pre-order demand expectations for the iPhone X to 50 million units from 40 million.

Seven of the 11 major S&P indexes were lower, led by losses in healthcare and consumer discretionary stocks.

General Motors dipped 3.7 percent after Goldman Sachs downgraded the company’s stock to “sell” from “neutral”.

Merck slipped 5.2 percent after the company said it withdrew an application for European use of its Keytruda cancer immunotherapy.

Advanced Micro Devices fell 4.8 percent after Morgan Stanley downgraded the stock to “underweight” from “equalweight”.

Declining issues outnumbered advancers on the NYSE by 1,417 to 1,226. On the Nasdaq, 1,424 issues fell and 1,071 advanced.

 

(Reporting by Sruthi Shankar in Bengaluru; Editing by Saumyadeb Chakrabarty)