Investment Commentary – September 9th, 2015
Dow 16,254 (-8.281% YTD)
S&P 500 1,942 (-5.68% YTD)
NASDAQ 4,757 (0.43% YTD)
Global Dow 2,336 (52 week low 2,263/high 2,644)
10-year Treasury (52 week low 1.64/high 2.66)
Gold $1,106 (52 week low $1,074/high $1,310)
Oil $44.33 (52 week low $37.75/high $90.76)
“U.S. stocks end sharply lower on specter of Fed rate hike”
U.S. stocks closed sharply lower Wednesday as worries about a potential interest-rate hike, sparked by a report showing a record rise in job openings in July, overshadowed stimulus efforts in Asian markets.
Earlier in the session, market optimism was underpinned by reassuring comments from officials in Beijing and Tokyo, leading to solid gains early Wednesday. But stocks retreated after job openings rose to a record of 5.75 million in July, from 5.32 million in June, according to the Labor Department.
“Today started off strong but there was a lack of follow through. And once the buyers got their fill, I believe it was natural for some worries to return and the weak hands that bought sold into the weakness,” said Robert Pavlik, chief market strategist at Boston Private Wealth LLC.
The S&P 500 SPX, -1.39% dropped 27.37 points, or 1.4%, to close at 1,942.04 and the Dow Jones Industrial Average DJIA, -1.45% slumped 239.11 points, or 1.5%, to 16,253.57, while the Nasdaq Composite COMP, -1.15% shed 55.40 points, 1.2%, to 4,756.53.
“Chinese premier seeks to quell global markets’ China fears”
China has fended off the major risks to its financial system while its economic prospects remain positive, Premier Li Keqiang said on Wednesday, as he tried to reassure global markets that Beijing can keep its economy on track and stock markets in check.
“The government took measures to stabilize the market and prevent risks from spreading, we have forced out the possibility of any systemic risks,” Li said during a speech at the World Economic Forum, the Switzerland-based corporate think-tank which runs the Davos summit of world leaders.
A run of soft economic data combined with China’s surprise devaluation of the yuan and wild swings in Chinese stock prices have rattled markets around the world over the past month.
Li conceded that China’s economy was facing downward pressures, but tried to allay concerns that after year of break-neck economic growth it was headed for a hard landing.
“There has been overall stability in China’s economic performance in spite of a certain amount of moderation. There’s an overall positive trend in spite of difficulties we face,” he said, adding that Beijing would “fine tune” its policies to provide more support.
Earlier on Wednesday China’s finance ministry said it would accelerate major infrastructure construction projects and reforms to its tax system to help stimulate the economy.
The views presented are not intended to be relied on as a forecast, research or investment advice and are the opinions of the sources cited and are subject to change based on subsequent developments. They are not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy.