Wednesday, November 13, 2013

Economic Journal - Wednesday, 11/13/2013

(As of 7:15 am PST)
 
Stocks continue their march lower with markets around the world taking profits on disappointing China news and confusion over the next Fed policy move.  Asian markets began the selling overnight as investors reacted to the conclusion of a four-day meeting among Chinese leaders known as the Third Plenum.  The meeting was expected to provide some detailed reform plans for the course of the Chinese economy, but instead a broad sweeping plan left investors disappointed.  The selling carried over into Europe as markets reacted to the possibility of a rate hike by the Bank of England as UK unemployment dropped unexpectedly.  US stocks are lower on the China news and also as investors positioned themselves ahead of tomorrow’s testimony from the Federal Reserve’s Janet Yellen.  After upbeat October data suggested the US economy remains on steady footing, markets are expecting the Federal Reserve to begin tapering their bond buying as early as the end of the year.  Expect volatility to pick up as the year winds down and investors consolidate gains ahead of a perceived tightening of the ‘loose money’ spigot.

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