(As of 7:20 am PST)
US
stocks opened to the downside Thursday with investor nerves on edge as
disappointing data continued to trickle in furthering concerns around global
economic growth. News that central banks in Norway and Taiwan surprisingly cut
their key interest rates broke early Thursday and sent caution throughout the
global equity markets. A less than stellar durable goods report added to the
negative sentiment early, as orders fell 2.0% in August, the first decline in 3
months. Softening business investment and a slowdown in orders for autos,
airplanes and machinery dragged on the report. In corporate news, Dow component
Caterpillar Inc. announced that they would cut 10,000 jobs by the end of 2018
as a part of a corporate restructure. The mining and construction equipment
maker, often viewed as a bellwether for global growth, also lowered its sales
outlook for 2015 and 2016. Caterpillar’s announcement caused losses to accelerate
in the first hour of trading. In overseas action, Asian markets finished mixed
while European stocks traded firmly lower as markets continued to deal with the
scandal involving Volkswagen and perhaps now other auto makers. Markets are
also gearing up for a speech from Federal Reserve Chairwoman Janet Yellen later
today as she speaks at a conference at UMass–Amherst on monetary policy. It
is not expected for Yellen to provide clues on the Fed’s rate hike plan,
however as usual her speech will be highly scrutinized and potentially market
moving. Gold is seeing some safe haven buying today as is the 10 yr. treasury
as yields fell to 2.09%.
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