Wall Street dips after worldwide slide; gold nears record

NEW YORK (AP) — Wall Street is slipping on Friday after tensions ramped higher between the world’s two largest economies, though the market pared its losses as the morning progressed.

The S&P 500 was 0.4% lower in midday trading, which would wipe out the last of its gains for the week. The Dow Jones Industrial Average was down 118 points, or 0.4%, at 26,534, as of 11:30 a.m. Eastern time, and the Nasdaq composite was down 0.5%. Each of the indexes had been down more sharply in the morning, with the Nasdaq off by as much as 2.3%.

Stocks also sank across Asian and European markets, and all the uncertainty helped gold top $1,900 per ounce, close to its record high. Treasury yields were holding relatively steady, but they remain close to their lowest levels since April.

The coronavirus pandemic remains the most dominant force in markets, with its potential to destroy lives and economies. But other risks are also bubbling up, headlined by Friday’s worsening relations between the United States and China.

Investors are also concerned about a recent uptick in layoffs as spiking coronavirus counts across the Sun Belt lead more businesses to shut down. Extra benefits for those out-of-work Americans from the federal government are set to expire soon, and worries are rising about whether Congress can reach a deal on more aid for the economy. Nearly half of Americans whose families experienced a layoff during the pandemic believe those jobs are lost forever, according to a poll from The Associated Press-NORC Center for Public Affairs Research.

Despite all those challenges, the S&P 500 remains only about 5% below its record set in February, after roaring back from an earlier, nearly 34% plummet. This week’s stall for the S&P 500 follows three straight weekly gains driven by hopes that the economy was regaining its footing. Underlying it all is massive aid for the economy promised by the Federal Reserve, including record-low interest rates.

“The Fed is the big story behind this market, that and the liquidity it’s provided,” said Teresa Jacobsen, managing director at UBS Private Wealth Management. “It gives a great deal of support for upside in the market. But, there are momentary blips when we pause and give a little back.”

On Friday, the blip came after China’s Foreign Ministry ordered the closure of the U.S. consulate in the western city of Chengdu. It echoes a similar move earlier this week by the United States to close the Chinese consulate in Houston.

Such moves have investors on edge because of how viciously markets swung in prior years when President Donald Trump was pressing his trade war with China, before they agreed to a temporary truce early this year.

“Alongside the eviction of the Houston Chinese Consulate, the risk of the U.S.-China conflict escalating into a ‘Cold War’ is worrying,” said Hayaki Narita of Mizuho Bank.

A speech Thursday by U.S. Secretary of State Mike Pompeo saying that “securing our freedom from the Chinese Communist Party is the mission of our time” adds to the rhetoric certain to incense Beijing, making it still more difficult for either side to back down, he said.

Technology stocks have also been in the spotlight, after a sharp slide for them on Thursday helped drag the S&P 500 to its worst loss in nearly four weeks.

Microsoft, Apple, Amazon and other giants have cruised through much of the pandemic on expectations that they can keep growing despite all the challenges for the economy. But critics say enthusiasm for them was overdone, with prices too high even after accounting for the huge profits that they can produce

Apple slipped 0.6%, Microsoft dropped 0.2%, and tech stocks as a group accounted for roughly half of the S&P 500’s loss. Earlier in the morning, Apple had been down 4%, and tech stocks were responsible for two thirds of the S&P 500′s drop.

Intel sank 15.3% after it delayed the release of its new 7 nanometer chip, and it was the biggest weight on the market Friday morning.

Earlier in the day, stocks in Shanghai sank 3.9%, while the Hang Seng in Hong Kong lost 2.2%. Elsewhere in Asia, South Korea’s Kospi fell 0.7%.

In Europe, France’s CAC 40 fell 1.5%, and Germany’s DAX lost 1.9%. The FTSE 100 in London dropped 1.3%.

The yield on the 10-year Treasury held steady at 0.58%. It tends to move with investors’ expectations for the economy and inflation.

Gold rose 0.5% to $1,900.30 per ounce, crossing above that threshold for the first time in nearly nine years. Benchmark U.S. crude slipped 14 cents to $40.93 per barrel. Brent crude, the international standard, lost 10 cents to $43.21 per barrel.

AP Business Writer Elaine Kurtenbach contributed.

The Associated Press

US Stock Market Experienced Gains After Impeachment Probe

Wall Street stocks were mixed early Wednesday, with Nike and Boeing gaining, as investors took a wait-and-see approach to a congressional impeachment investigation of President Donald Trump.

The anticipation of the impeachment probe was a factor in the stock market’s retreat on Tuesday.

But the US stock market and investors appeared to be taking the news in stride after House Democratic Leader Nancy Pelosi formally announced the probe.

Wednesday’s flattish early trading “suggests that the market isn’t going to allow itself to get too worked about the inquiry at this stage of matters when the headlines are heavy but the tradable facts of import are light,” analyst Patrick O’Hare wrote at Briefing.com.

About 20 minutes into trading, the Dow Jones Industrial Average stood at 26,841.85, up 0.1 percent.

The broad-based S&P 500 was essentially flat at 2,965.68, while the tech-rich Nasdaq Composite Index had shed 0.2 percent at 7,978.90.


Among individual companies, Dow member Nike surged 5.2 percent after reporting better-than-expected quarterly profits on strong direct sales and higher revenues from China.

Boeing also added to the Dow’s gains, advancing 0.6 percent as it announced a number of reforms to its board and corporate structure to highlight safety concerns after two crashes led to 346 fatalities and the grounding of its popular 737 MAX plane.

Philip Morris International jumped 5.9 percent as it and Altria called off a potential $200 billion merger following a sudden surge in worries about vaping.

Altria, which holds a major stake in e-cigarette company Juul, gained 0.5 percent.

source: usa.inquirer.net

Asian shares mixed as investors look ahead to rate decisions

TOKYO – Asian shares were mixed Tuesday after a day of listless trading on Wall Street, as investors awaited signs on global interest rates.

Japan’s benchmark Nikkei 225 added 0.2% to 21,360.15 in morning trading.

Australia’s S&P/ASX 200 fell 0.5% to 6,618.20, while South Korea’s Kospi inched up 0.1% to 2,021.73.

Hong Kong’s Hang Seng was up nearly 0.1% at 26,703.44, while the Shanghai Composite lost 0.4% to 3,012.03.

On Wall Street, the S&P 500 ended virtually flat as losses in technology and health care stocks outweighed gains in financials and other sectors. The Russell 2000 index of smaller company stocks, which has lagged the S&P 500 this year, outpaced the rest of the market.

Investors are taking a shine to smaller company stocks in hopes that they’ll be better shielded from the fallout of the costly trade war between the U.S. and China than large multinationals.


The S&P 500 inched 0.28 points lower, or less than 0.1%, to 2,978.43. The index, which has finished higher the past two weeks, is within 1.6% of its all-time high set in late July. The Dow Jones Industrial Average rose 38.05 points, or 0.1%, to 26,835.51. The Nasdaq fell 15.64 points, or 0.2%, to 8,087.44. The Russell 2000 climbed 19.06 points, or 1.3%, to 1,524.23.

The broader market has bounced back the past two weeks following volatility brought on by the trade war as Washington and Beijing imposed new tariffs on more of each other’s imported goods. Investors worry the escalation of tariffs may be dampening global economic growth and threatening to nudge the United States into a recession.

Traders are hoping for a deal between the world’s two largest economies and were encouraged last week by news that talks will resume in October.

A mixed bag of economic data has also kept Wall Street focused on central banks and whether they will continue taking measures to shore up economic growth. On Friday, Federal Reserve Chairman Jerome Powell said the central bank doesn’t expect a recession and will take necessary actions to maintain growth.

Economists expect the Fed to cut interest rates when it meets next week.


Separately, the European Central Bank is expected to unveil new monetary stimulus measures on Thursday to help shore up the region’s economy.

“Markets look to be adrift ahead of the slew of events this week including the likes of the European Central Bank where further support for the markets is expected,” said Jingyi Pan, market strategist at IG in Singapore.

“As far as the risk sentiment is concerned, the improvement carries forth from the previous week in anticipation of the various central bank meetings.”

ENERGY:

Benchmark crude oil rose 42 cents to $58.27 a barrel. It rose $1.33 to $57.85 a barrel Monday. Brent crude oil, the international standard, gained 46 cents to $63.05 a barrel.

CURRENCIES:

The dollar rose to 107.39 Japanese yen from 106.96 yen on Monday. The euro strengthened to $1.1046 from $1.1037. /gsg

source: business.inquirer.net

Fear on Wall Street of an Economic Slowdown

U.S. stocks fell broadly in midday trading Wednesday as central banks around the world cut interest rates and increased fears that global growth is being crimped by the U.S.-China trade war.

Every major U.S. index fell and put stocks back on a course for losses after briefly breaking a six-day losing streak on Tuesday. The losses eased as the day progressed, though investors remained in a defensive mode and headed for relatively safe holdings.

Bond prices spiked again, sending the yield on the 10-year Treasury down to 1.64% from 1.74% late Tuesday, a large move.

Yields are at their lowest level in nearly three years. That benchmark yield has retreated from its recent high of 3.23% last November as expectations of economic growth have steadily faded.


“The Treasury market is trading much higher this morning as investors continue to seek a safer haven, completely unsure as to what may happen next,” Kevin Giddis, head of fixed income capital markets at Raymond James wrote in a report.

Banks sustained some of the worst losses. Lower bond yields mean lower interest rates on mortgages and other kinds of loans, which mean lower profits for banks. JPMorgan Chase fell 3.1% and Bank of America fell 3.3%.

The dimming expectations for global growth also send the price of crude oil sharply lower. Benchmark U.S. crude plunged 4.5% at $51.20 a barrel. That helped pull energy sector stocks lower. Occidental Petroleum gave up 3.3%.

Big technology stocks, longtime investor favorites, also posted hefty losses. IBM lost 1.8%.

Safe-play stocks, including consumer staples and utilities, held up far better than the rest of the market.

The S&P 500 index fell 0.5% as of 11:12 a.m. Eastern time. The Dow Jones Industrial Average fell 238 points, or 0.9%, to 25,790. It was down as much as 589 earlier.

The Nasdaq fell 0.1%

China on Monday allowed its currency, the yuan, to weaken against the U.S. dollar in response to U.S. threats to add more tariffs to Chinese goods.

China stabilized the yuan on Tuesday and that helped lift U.S. stocks a day after they endured their worst day of the year. The volatile trading has already put a dent in the major indexes yearly gains. The S&P 500 is down 3.8% for August.

Central banks in New Zealand, India, and Thailand cut key interest rates on Wednesday and investors around the world fear that the escalating trade war between the U.S. and China will severely damage global growth.

After the surprise interest-rate cuts, bond yields sank around the world as investors scrambled for safety. They also poured into gold, which jumped to its highest price in more than six years.

“There is almost a paranoia amongst central bankers to avoid any potential financial hiccups that might hurt the real economy and cause a slowdown,” Jefferies strategist Sean Darby wrote in a report.

U.S. stocks have been on a wild ride since Jan. 22, 2018, when Trump first imposed tariffs on solar products and washing machines to help U.S. manufacturers, but they’re virtually back to where they started.

The S&P 500 closed at 2,832.97 that day and has since been down as much as 17% and up as much as 7%, with moves often driven by waxing and waning worries about the trade war. On Wednesday morning, the S&P 500 sat at 2,862.45, up 1% from that early 2018 starting point.

Since Trump tweeted in March 2018 that “trade wars are good, and easy to win” after raising tariffs on steel and aluminum, the S&P 500 is up 6.3%, though that gain has nearly halved in the last couple weeks as worries about the trade war have surged.

A key gauge of fear in the marketplace surged 6.2%. The VIX index, which measures how much traders are paying to protect themselves from swings in the S&P 500, was still below where it was at the start of the year when recession fears were surging, but it’s close to its highest level of the year.

European and Asian indexes were mixed.

Disney fell 5.1% after disappointing investors with a sharp third-quarter profit plunge that fell far short of Wall Street forecasts.

The entertainment company said underperformance from its Fox movie and TV studio helped weigh down the fiscal third-quarter financial results. It bought Fox’s entertainment business in March for $71 billion.

Match Group shares jumped 25.2% after the operator of Tinder, OkCupid and other dating sights beat Wall Street’s second-quarter earnings forecasts. The company reported a surge in Tinder subscribers and raised its revenue forecast for the year.

Drugstore operator CVS Health rose 6% after swinging to a second-quarter profit and handily beating Wall Street forecasts. The company attributed part of the gains to health insurer Aetna, which it bought for $69 billion in November.

source: usa.inquirer.net

Asian markets suffer as US-North Korea tension escalates anew

Asian markets fell again Wednesday as nervous traders shifted toward safe havens on concerns about North Korea’s latest saber-rattling, while technology firms suffered another torrid day of selling.

Washington confirmed Tuesday that Pyongyang’s latest rocket test was of a missile capable of reaching the United States, ratcheting up pressure in an already tense crisis on the Korean peninsula.

Dealers are now awaiting the next development after Russia and China issued a joint appeal to ease tensions while the United Nations Security Council will hold an emergency meeting later in the day.

The test came just as the US was preparing to celebrate Independence Day and days before a G20 summit, where it will likely top the agenda.

It was the latest provocation by North Korean leader Kim Jong-Un who is determined to develop a nuclear weapons program he says is needed to ward off invasion.

South Korea and the US on Wednesday launched a barrage of missiles simulating a precision strike against Pyongyang, in response to the provocation.

“Traders and investors may be wondering what reaction this latest missile test will get,” said Greg McKenna, chief market strategist at AxiTrader.

With caution flowing through trading floors, markets sank into negative territory.

Tokyo ended the morning 0.5 percent lower with the yen, considered a safe bet in times of turmoil and uncertainty, strengthening against the dollar which hurt Japan’s exporters.

Hong Kong slipped 0.1 percent a day after diving 1.5 percent, while Shanghai shed 0.2 percent. Sydney lost 0.3 percent, Singapore eased 0.1 percent and was marginally lower.

Wellington and Taipei were also in the red.

Traders were given few leads with European markets slightly down and Wall Street closed for the July 4 holiday.

Tech firms were again suffering as global central banks consider tightening monetary policy.

The sector has been a huge beneficiary of the years of cheap borrowing from lenders, sending their stock prices soaring but the prospect of an end to such largesse has led to profit-taking.

Hong Kong-listed Tencent extended Tuesday’s more than four percent loss, while AAC Technologies also retreated and Sony slipped in Tokyo.

However, energy companies continued to benefit from the recovery in oil prices although the black gold, which is up about 10 percent since hitting recent lows in mid-June, dipped slightly Wednesday in Asia.

Investors are awaiting the release Wednesday of minutes from the Federal Reserve’s June policy meeting and key US jobs data Friday. JPV

source: business.inquirer.net

Surging Bitcoin breaks through $1,000 barrier

PARIS, France — The value of Bitcoin surged above $1,000 on Monday as the digital unit continues a dizzying rise that made it the best-performing currency of 2016.

Its value has more than doubled in the last year and it was trading at around $1,024 in afternoon European trading on Monday, after breaking through the $1,000 mark on Sunday.

It is now within reach of its historic high of more than $1,200 reached in 2013.

Some analysts believe the rise in Bitcoin is due to some investors treating it as a safe-haven, like gold, at a time of global uncertainty.

Others believe buying is being driven by speculative demand, with investors anticipating future rises and creating an unsustainable bubble.

Bitcoin was launched in 2009 as a bit of encrypted software written by someone using the Japanese-sounding name Satoshi Nakamoto.

Earlier this year secretive Australian entrepreneur Craig Wright said that he was the creator, but some have raised doubts over his claim.

Supply of Bitcoin is limited and it trades in cyberspace. As well as being an investment for some, it is also used for illicit transactions beyond the reach of law enforcement for drugs or arms on the internet.

Its value has fluctuated wildly since its creation, with news of a major Bitcoin theft by hackers in August sending its price plummeting by more than 20 percent.

Unlike traditional currencies such as the dollar or the euro, which require the sponsorship of a central bank, Bitcoin is decentralized.

Encrypted digital coins are created by supercomputers and then traded online or exchanged for goods and services by a network of users.  CBB

source: technology.inquirer.net

Characteristics Fit For CFD Trading

If you are familiar with CFD (contract for difference) trading you would know that it is not for everybody. The job is demanding, high-stressed, fast-paced, and downright difficult. Nevertheless, there are individuals whose innate characteristics are suited for such job. Here are specific personality characteristics that are fit for successful traders.

Realistic CFD Trading

CFD trading is not an exact science. Losses are possible as much as gaining. Nobody, no matter how good they are can guarantee a winning trade all the time. There are a lot of factors that come into play during trading and most of them are outside anybody’s control. This is the reason why being realistic is important for a trader to excel. If you want to go into this kind of business then you have a complete grasp of what is happening all around you. Even if you plan on earning an identified amount, you have to be open to the possibility of not hitting it if odds are not favorable. Realistic people are grounded. They are accepting of circumstances, whether good or bad. They have a clear grasp of the fact that there are just certain happenings that are beyond control. They do not brood long and continuously move on.

Driven

Being successful in CFD trading requires passion and immeasurable amount of drive. As earlier mentioned, this business is not easy. There will be a lot of times that you might feel discouraged and frustrated because of failures. However, if you stop and quit every time things get tough then you will not be present to see better days. Individuals who are driven have high endurance. They can stay in a task for a long time until they figure it out. They are tireless in pursuing what they want. They don’t stop until they reach their goals because they have to satisfy their need for achievement.

Optimistic

True optimists do not live in a make-believe world, where everything is pretty and colorful. If you are a true-blue optimistic person it means that you don’t easily get bogged down by set-backs. You have the ability to bounce back whenever you encounter failures. You have an attitude that readily sees what you can use to do better, even during failings. Being optimistic is important when doing CFD trading. Traders encounter situations that may seem unbearable and without a healthy attitude it would be hard to go on and improve.

Flexible

There is no clear cut strategies that can guarantee a winning trade every time. Every strategy is dependent on the kind of situation. There are even a lot of instances wherein there is a need to change techniques during trading. This is where being flexible would come in. If you are flexible it is very unlikely that you are stubborn. You will not have any difficulty changing strategies mid-way. You wouldn’t stick to things that are not working just because you thought it would. You have an open-mind and can readily adapt. If you are not flexible then you may end up losing all your account credit sticking to what you believe in; even though, it no longer applies.

Sociable

Technically, traders work alone. However, every trade involves numerous traders, meaning people. Essentially individuals in the trading business are indirectly dealing with a lot of people all the time. If you are sociable, you can mingle with different kinds of people, most especially traders. You may not be aware of it during the start of contact but you get to take home valuable knowledge whenever you interact with others. This is particularly true if you have contacts with some of the best people in the field. You can learn so much from their wealth of experience.

source:  marriedwithdebt.com

Dollar up against yen as Japan's trade deficit swells

TOKYO – The dollar rose against the yen in quiet Asian trade Monday after data showed Japan's trade deficit quadrupled year on year in March.

The greenback fetched ¥102.63 in Tokyo mid-day trading, up from ¥102.46 Friday, while the euro was up at ¥141.74 from ¥141.46. The single currency also fetched $1.3810, against $1.3812.

Most leading financial markets around the world were closed Friday and Monday for Easter.

The yen faced moderate selling pressure after Japan said early Monday that its trade deficit surged to $14 billion in March, with a weak yen compounding surging imports as consumers rushed to buy ahead of a sales tax rise on April 1.

But the dollar is unlikely to breach ¥103 any time soon as investor sentiment has yet to completely turn the risk-on mode, says Osamu Takashima, chief FX strategist at Citi Bank Japan, in a morning note.

"We don't feel any sign that aggressive yen selling is set to start amid falling volatility," Takashima said.

Eyes are on the release this week of key economic data, including manufacturing activity around the world as well as retail, jobs and housing figures in the United States. – Agence France-Presse

source: gmanetwork.com

Peso trades sideways ahead of US debt ceiling deadline

The peso closed barely changed Monday, as investors took on a wait-and-see attitude ahead of the US debt ceiling talks between Democrats and Republicans.

A dollar fetched P43.15 at the close of trading, just a centavo and a half more than the P43.135 it got last Friday. Trading volume totaled $534 million compared with $818.3 million Friday.

“It was a very lethargic trading with low volume,” a trader at a local bank said.

All eyes are on the negotiations in the US Senate on bringing the fiscal crisis to an end, which as of Sunday in Washington showed little signs of progress, Reuters reported.

Failure to break the stalemate before Oct. 17, Thursday, would leave the world's biggest economy unable to pay its bills in the coming weeks.

In a separate interview, a second trader said investors held on to their positions in the face of the uncertainty over what would happened to markets should the US default on its obligations.

“Expectations of the US defaulting is increasing, but a lot of investors are still holding on to dollars – because that's supposedly the safe haven. We're slowly seeing lines get blurred,” she said.

Philippine financial markets will be closed Tuesday in observance of Eidul Adha or the Feast of Sacrifice of Muslims. – VS, GMA News

source: gmanetwork.com