Market Update
Final Hour Sparks Another Wave of Selling on Wall Street, Bond Yields Rise
Barry Adams
15 Sep, 2022
New York City
Stocks on Wall Street lacked direction and struggled to stay above the flat-line and accelerated declines in the final hour of trading.
Benchmark indexes fell more than 1% as investors digest conflicting trends in the economy.
Economy is slowing down as the housing market faces surging mortgage rates but labor market conditions remain tight and consumer spending is holding up despite high inflation.
However, global markets remain defensive as nervous investors digest the implications of higher rates and economic slowdown.
Economic slowdown worries spilled over energy markets and crude oil prices eased in New York and in European trading.
Weakening economic backdrop and stubborn inflation has also lifted bond yields around the world.
The S&P 500 index fell 1.1% to 3,901.35 and the Nasdaq Composite index declined 1.4% to 11,552.37.
Oil complex traded lower after energy prices eased from one-week highs.
Bond Market Route Continues
The yield on 10-year U.S. Treasury bonds are above 3.45% and approaching the peak of 3.5% reached in June, 2-year notes are now at 3.86%, a 15-year high and 30-year bond at 3.47%.
In addition, the bond yields in Germany are at 1.7%, a 8-year high, as the deepening energy crisis shows no sign of easing. Yields in Greece and Italy are above 4%, prompting worries of another sovereign debt crisis in the eurozone.
Crude Oil Searches Bottom
Global market sentiment has been weakening on the extended coronavirus lockdowns and housing market problems in China, natural gas crisis in Europe, and escalating interest rates in the U.S.
Moreover, shifting of Russia's oil supply to Asia and a conflict between Armenia and Azerbaijan has kept the supply worries in front and center.
WTI crude oil price declined $3.30 to $86.12 a barrel and Brent crude price declined $3.30 to $90.31.
Natural gas price dropped 81 cents to $8.29 a thermal unit and the TTF gas price in Europe fell 1.6% to
Movers: Adobe, Bed Bath & Beyond, Danaher, FedEx
Barry Adams
15 Sep, 2022
New York City
Adobe plunged 17% to $309.13 after the company announced a deal to acquire cloud-based software design company Figma Inc for $20 billion in cash and stock.
Bed Bath & Beyond increased 0.4% to $8.79 after the company said it plans to close 150 of its namesake stores of which over 50 are scheduled to be closed by the end of 2020.
The struggling retailer said it has secured more than $500 million in new secured financing and it plans to cut 20% of its supply chain and corporate staff.
Danaher Corp jumped 3% but closed up nearly unchanged at $281.91 after the medical technology and industrial products maker said it plans to separate its environment and science applications division as a separate company in the last quarter of 2023.
FedEx withdrew its fiscal 2023 earnings guidance released on June 23 after disappointing fiscal first quarter revenues and shipments.
The company also lowered its fiscal 2023 capital spending plan to to $6.3 billion from the previous estimate of $6.8 billion.
The company reaffirmed its previously announced plan to repurchase $1.5 billion of its common stock in fiscal 2023 of which $1.0 billion is expected in the fiscal second quarter.
The parcel delivery company said it plans to cut costs, delay hiring and close 90 offices and five corporate sites.
FedEx fell 15% to close at $204.87.
European Markets Deepen Losses, Eurozone Deficit with China, Russia, Norway Soar
Bridgette Randall
15 Sep, 2022
Frankfurt
European markets struggled to advance after two days of losses as the energy crisis remains in the spotlight and investors digest mixed U.S. economic data.
Benchmark indexes in Germany and France declined after governments raised the spectre of energy rationing in the coming weeks as natural prices remain sky-high and supplies are tight.
Germany's wholesale price inflation eased to 18.9% after rising 19.5% in July, Destatis reported Thursday.
The wholesale price inflation has declined for the fourth month in a row.
On a monthly basis, wholesale prices inched up 0.1% after falling 0.4% in July.
Consumer price inflation in France slowed to 5.9% in August from 6.1% in July, France's statistics office Insee reported Thursday.
Consumer price inflation in August was estimated at 5.8% in the preliminary estimate released on August 31.
U.K.'s consumer confidence slipped in the negative territory for the first time since June 2020.
Greece's jobless rate declined to 12.4% in the second quarter from 13.8% in the first quarter, a survey from the Hellenic Statistical Authority showed Thursday.
The unemployment rate declined from 15.8% a year ago.
The DAX index declined 50.55 or 0.4% to 12,974.77, the CAC-40 index fell 1.2% or 75.66 to 6,146.75 and the FTSE 100 index added 0.1% or 4.77 to 7,282.07.
Banks in Germany led the gainers on the back of rising interest rates.
Commerzbank added 3.5% and Deutsche Bank advanced 2.5%.
In Madrid trading, Bankinter, Sabadell and Caixabank gained more than 5% on the hopes that Spain may revise a tax that is deemed to violate the European Central Bank's directive.
Eurozone Swings to Trade Deficit
The euro area trade balance swung to a merchandise trade deficit of
Weekly Jobless Claims Lowest Since May
Brian Turner
15 Sep, 2022
New York City
Initial weekly jobless claims declined 5,000 to 213,000 in the week ending on September 10, the U.S. Department of Labor said Thursday.
The initial claims were the lowest since the last week in May highlighting the tight labor market conditions.
Initial claims plunged 40% from 363,000 a year ago in the similar period.
Seasonally unadjusted claims declined 16,934 from the previous week to 155,961.
Retail Sales In August Rise 0.3%
Brian Turner
15 Sep, 2022
New York City
Retail sales in August rose 0.3% from July, when sales fell 0.4% after a revision, the U.S. Census Bureau and Commerce Department said Thursday.
Advance estimates of U.S. retail and food services sales for August adjusted for seasonal factors and calendar were $683.3 billion, an increase of 0.3% from the previous month, and 9.1% higher from a year ago.
July retail sales were revised lower from flat to a decline of 0.4%.
Retail sales data are not adjusted for inflation and falling gasoline prices helped consumers to make other purchases.
Gasoline stations sales declined 4.2%, furniture store sales fell 1.3%, and sales at non-store retailers decreased 0.7%.
Sales of motor vehicles and parts rose 2.8% from the previous month and 6.7% from a year ago and food and beverages increased 0.5% and 7.2% respectively.
Excluding gasoline stations, sales increased 0.8%.
Core retail sales which exclude automobiles, gasoline, building materials and food services, were flat.
The September 2022 Advance Monthly Retail report is scheduled for release on October 14, 2022 at 8:30 a.m. EDT.
Industrial Production Falls
Brian Turner
15 Sep, 2022
New York City
Industrial production in August declined 0.2% from July but rose 3.7% from a year ago, the Federal Reserve Board reported Thursday.
Manufacturing output edged up 0.1% after rising 0.6% in July.
The index for mining was unchanged, and the index for utilities decreased 2.3%.
Capacity utilization declined 0.2 percentage point in August to 80.0%.
U.S. Stocks Lack Direction Amid Conflicting Economic Data
Barry Adams
15 Sep, 2022
New York City
Stocks on Wall Street lacked direction and struggled to stay above the flat-line as investors digest conflicting trends in the economy.
Economy is slowing down as the housing market faces surging mortgage rates but labor market conditions remain tight and consumer spending is holding up despite high inflation.
However, global markets remain defensive as nervous investors digest the implications of higher rates and economic slowdown.
Economic slowdown worries spilled over energy markets and crude oil prices eased in New York and in European trading.
Weakening economic backdrop and stubborn inflation has also lifted bond yields around the world.
The S&P 500 index rose 0.2% to 3,954.50 and the Nasdaq Composite index gained 0.24% to 11,743.87.
Financials led the early gains in the session with banks and brokerage companies leading the gainers.
Oil complex traded lower after energy prices eased from one-week highs.
Adobe Inc plunged 10% after the software company said it agreed to acquire design software platform developer Figma for $20 billion.
Weekly Jobless Claims Lowest Since May
Initial weekly jobless claims declined 5,000 to 213,000 in the week ending on September 10, the U.S. Department of Labor said Thursday.
The initial claims were the lowest since the last week in May highlighting the tight labor market conditions.
Initial claims plunged 40% from 363,000 a year ago in the similar period.
Seasonally unadjusted claims declined 16,934 from the previous week to 155,961.
Retail Sales In August Rise 0.3%
Retail sales in August rose 0.3% from July, when sales fell 0.4% after a revision, the U.S. Census Bureau and Commerce Department said Thursday.
July retail sales were revised lower from flat to a decline of 0.4%.
Retail sales data are not adjusted for inflation and falling gasoline prices helped consumers to make other purchases.
Gasoline stations sales declined 4.2%, furniture store sales fell 1.3%, and sales at non-store retailers decreased 0.7%.
Excluding gasoline stations, sales increased 0.8%.
Core retail sales which exclude automobiles, gasoline, building materials and food services, were flat.
Industrial Production Falls
Industrial production in August declined 0.2% from July but rose 3.7% from a year ago, the Federal Reserve Board reported Thursday.
Manufacturing output edged up 0.1% after rising 0.6% in July.
The index for mining was unchanged, and the index for utilities decreased 2.3%.
Capacity utilization declined 0.2 percentage point in August to 80.0%.
Bond Market Route Continues
The yield on 10-year U.S. Treasury bonds are above 3.45% and approaching the peak of 3.5% reached in June and 2-year notes are now at 3.8%, a 15-year high.
In addition, the bond yields in Germany are at 1.7%, a 8-year high, as the deepening energy crisis shows no sign of easing. Yields in Greece and Italy are above 4%, prompting worries of another sovereign debt crisis in the eurozone.
Crude Oil Searches Bottom
Global market sentiment has been weakening on the extended coronavirus lockdowns and housing market problems in China, natural gas crisis in Europe, and escalating interest rates in the U.S.
Moreover, shifting of Russia's oil supply to Asia and a conflict between Armenia and Azerbaijan has kept the supply worries in front and center.
WTI crude oil price eased $1.20 to $87.22 a barrel and Brent crude price declined $1.40 to $92.71.
Surging energy costs also negatively impacted trade balance for the eurozone.
Railroad Strike Averted for Now
Railroad stocks traded higher after President Joe Biden announced a preliminary agreement for a better pay and working conditions for railroad workers.
The agreement is likely to avert the strike for now and disruptions in services.
In corporate news, Adobe dropped nearly 10% after the company announced a deal to acquire cloud-based software design company Figma Inc for $20 billion in cash and stock.
Danaher Corp jumped 3% after the medical technology and industrial products maker said it plans to separate its environment and science applications division as a separate company in the last quarter of 2023.
Eurozone Trade Balance Swings to Deficit
Brian Turner
15 Sep, 2022
New York City
The euro area trade balance swung to a merchandise trade deficit of
Stocks, Bonds, Oil Look Down
Barry Adams
15 Sep, 2022
New York City
Global markets remain defensive as nervous investors digest implications of higher rates and economic slowdown.
Economic slowdown worries spilled over energy markets and crude oil prices eased in New York and in European trading.
Weakening economic backdrop and stubborn inflation has also lifted bond yields around the world.
Bond Market Rout Deepens
The yield on 10-year U.S. Treasury bonds are above 3.45% and approaching the peak of 3.5% reached in June and 2-year notes are now at 3.8%, a 15-year high.
In addition, the bond yields in Germany are at 1.7%, a 8-year high, as the deepening energy crisis shows no sign of easing. Yields in Greece and Italy are above 4%, prompting worries of another sovereign debt crisis in the eurozone.
Crude Oil Searches Bottom
Global market sentiment has been weakening on the extended coronavirus lockdowns and housing market problems in China, natural gas crisis in Europe, and escalating interest rates in the U.S.
Moreover, shifting of Russia's oil supply to Asia and a conflict between Armenia and Azerbaijan has kept the supply worries in front and center.
WTI crude oil price eased $1.20 to $87.22 a barrel and Brent crude price declined $1.40 to $92.71.
Surging energy costs also negatively impacted trade balance for the eurozone.
U.S. Stocks Trade with Downward Bias
In New York, benchmark indexes traded down between 0.3% and 0.5% and tech stocks led the decliners in early trading.
Railroad stocks traded higher after President Joe Biden announced a preliminary agreement for a better pay and working conditions for railroad workers.
The agreement is likely to avert the strike for now and disruptions in services.
In corporate news, Adobe dropped nearly 10% after the company announced a deal to acquire cloud-based software design company Figma Inc for $20 billion in cash and stock.
Danaher Corp jumped 3% after the medical technology and industrial products maker said it plans to separate its environment and science applications division as a separate company in the last quarter of 2023.
Eurozone Swings to Trade Deficit
The euro area trade balance swung to a merchandise trade deficit of
Slight Rebound in Stocks A Day After Sell-off, 2-year Yield at 15-year High
Barry Adams
14 Sep, 2022
New York City
Benchmark indexes on Wall Street struggled around the flat-line a day after major averages recorded this year's worst losses and fell the most in two years.
Major averages struggled to stay in the positive zone after four attempts in choppy trading and accelerated the decline in the final hour of trading.
Popular indexes managed to rebound in the final 20 minutes of trading and closed marginally higher in the session.
The S&P 500 index increased 0.3% to 3,946.01 and the Nasdaq Composite index added 0.7% to 11,719.84.
Tech stocks rebounded on the hopes that Tuesday's sell-off was overdone but nervous investors worried a sustained rally in less likely until there is a clarity on the inflation front.
Apple, Tesla, IBM, Microsoft, Google and Amazon added between 0.5% and 1.5%.
Oil complex stocks gained after crude oil and natural gas prices continued to advance.
APA, Marathon Oil, Hess, Exxon Mobil, Chevron and Schlumberger gained between 2% and 4.5%.
Crude oil price rebounded 2% and reached a one-week high nearing $89 a barrel.
Crude oil prices advanced $1.55 to $88.67 a barrel and natural gas increased 82 cents to $9.10 a thermal unit.
Producer prices, a measure of wholesale prices, declined 0.1% in August after falling 0.4% in July, the second monthly decline in a row.
Gasoline prices fell 12.7% but services prices rose 0.4%, the fourth monthly increase in a row.
On a yearly basis, producer prices slowed to 8.7% in August from 9.8% in July. the U.S. Bureau of Labor Statistics reported Wednesday.
The yield on 2-year Treasury notes increased to 3.80%, 10-year notes edged up to 3.40% and 30-year bonds eased to 3.46%.
European Leaders Plan to Intervene In Energy Markets
Market indexes in Europe swung between losses and gains as investors focused on faster and larger rate increase outlook in the U.S.
Energy policy was also in focus in the region after President Ursula von der Leyen said that the European Commission is considering intervening in the energy markets including price caps and revenue caps on low-cost electricity producers.
The market interventions are expected to generate
Movers: Home Builders, Railroads, Nucor, Starbucks, Twilio, United Airlines
Barry Adams
14 Sep, 2022
New York City
Benchmark indexes on Wall Street struggled around the flat-line a day after major averages recorded this year's worst loss and fell the most in two years.
Producer prices, a measure of wholesale prices, declined 0.1% in August after falling 0.4% in July, the second monthly decline in a row.
The S&P 500 index increased 0.3% to 3,943.58 and the Nasdaq Composite index added 0.7% to 11,712.18.
Crude oil price rebounded 2% and reached a one-week high nearing $89 a barrel.
Crude oil prices advanced $1.20 to $88.54 a barrel and natural gas increased 47 cents to $8.73 a thermal unit.
The yield on 2-year Treasury notes increased to 3.80%, 10-year notes edged up to 3.42% and 30-year bonds eased to 3.50%
Home builders extended two-day losses to more than 10% after mortgage loan application volume decreased 1.2% for the week ending September 9 from the previous week on a seasonally adjusted basis.
From a year ago, the application volumes declined nearly one third.
European Markets Lack Direction, EU Mulls to Intervene Energy Markets
Bridgette Randall
14 Sep, 2022
Frankfurt
Market indexes in Europe swung between losses and gains as investors focused on faster and larger rate increase outlook in the U.S.
Energy policy was also in focus in the region after President Ursula von der Leyen said that the European Commission is considering intervening in the energy markets including price caps and revenue caps on low-cost electricity producers.
The market interventions are expected to generate
Producer Prices Eases In August to 8.7%
Brian Turner
14 Sep, 2022
New York City
Producer prices, a measure of wholesale prices, declined 0.1% in August after falling 0.4% in July, the second monthly decline in a row.
Gasoline prices fell 12.7% but services prices rose 0.4%, the fourth monthly increase in a row.
On a yearly basis, producer prices slowed to 8.7% in August from 9.8% in July. the U.S. Bureau of Labor Statistics reported Wednesday.
Stocks Wavered, Investors Rattled, Yields Spiked
Barry Adams
14 Sep, 2022
New York City
Benchmark indexes on Wall Street struggled around the flat-line a day after major averages recorded this year's worst loss and fell the most in two years.
Producer prices, a measure of wholesale prices, declined 0.1% in August after falling 0.4% in July, the second monthly decline in a row.
Gasoline prices fell 12.7% but services prices rose 0.4%, the fourth monthly increase in a row.
On a yearly basis, producer prices slowed to 8.7% in August from 9.8% in July. the U.S. Bureau of Labor Statistics reported Wednesday.
The S&P 500 index increased 0.3% to 3,942.60 and the Nasdaq Composite index added 0.3% to 11,664.78.
Crude oil price rebounded 2% and reached a one-week high nearing $89 a barrel.
Crude oil prices advanced $1.20 to $88.54 a barrel and natural gas increased 47 cents to $8.73 a thermal unit.
The yield on 2-year Treasury notes increased to 3.80%, 10-year notes edged up to 3.42% and 30-year bonds eased to 3.50%.
Europe Looks to Intervene Energy Markets
In Europe, market indexes swung between losses and gains as investors focused on faster and larger rate increase outlook in the U.S.
Energy policy was also in focus in the region after President Ursula von der Leyen said that the European Commission is considering intervening in the energy markets including price caps and revenue caps on low-cost electricity producers.
The market interventions are expected to generate
S&P 500 Plunges 4%, Nasdaq Drops 5%
Barry Adams
13 Sep, 2022
New York City
Stocks plunged on Wall Street after the latest data showed how entrenched high prices have become in the broader economy.
The today's market plunge erase gains of the last one week and the benchmark indexes dropped near to the level last seen on September 6.
Consumer prices in August rose at a slower pace of 8.3% in August following a rise of 8.5% in July, the Bureau of Labor Statistics said Tuesday.
On s monthly basis, prices increased 0.1% from July when prices were flat from the previous month.
Consumer inflation advanced at a slower pace annually in August but still remained elevated and significantly above the 2% target set by the Federal Reserve.
Benchmark indexes have been rallying for a week on the hopes of cooling inflation and discouraging the Fed from lifting rates by another large amount.
However, the latest elevated inflation report only strengthened the case for lifting key lending rates again by 75 basis points at the next Fed's meeting later this month.
The market sentiment worsened and investors feared that the Fed may have to increase the pace and the size of rate hikes beyond 75 basis points and keep higher rates longer.
The S&P 500 index dropped 4.3% to 3,932.69 and the Nasdaq Composite index plunged 5.2% to 11,633.57.
The S&P 500 index and the Dow Jones Industrial Average recorded their worst day of 2022.
Crude oil declined 21 cents to $87.56 a barrel and natural gas rose 11 cents to $8.35.
The yield on 2-year Treasury notes rose to 3.75%, 10-year notes advanced to 3.43%, and 30-year bonds to 3.49%.
European Markets Plunge After U.S. Inflation Data
Benchmark indexes in Europe plunged after U.S. consumer inflation was higher than expected and dented the hopes of less aggressive rate hikes.
The DAX index plunged 1.4% to 13,211.26, the CAC-40 index declined 1.2% to 6,257.31, and the FTSE 100 index dropped 1.1% to 7,391.47.
The euro edged down to $1.0003 and the British pound traded down to $1.1519.
Brent crude oil declined $1.90 to $92.08 a barrel and TTF natural gas price gained 6% to 202.55 euros a megawatt hour.
The bond yields rose following the U.S. inflation report.
The yield on 10-year bonds issued by Germany rose to 1.72%, U.K. advanced to 3.17%, France gained to 2.29% and Switzerland to 1.08%.
UK Jobless Rate Drops to 48-Year Low
The latest jobs market data released by the Office for National Statistics offered mixed views but supported the case for higher rates by the Bank of England.
Jobless rate in the U.K. held steady at 3.9% in August, the number of people claiming jobless benefits rose 6,300 contrary to the expectation of a decline of 13,000, according to the data released by the Office for National Statistics.
Unemployment rate declined to 3.6% in three months to July, the lowest since the similar three-month period in 1974.
In August, employees on payrolls increased 71,000 from July to a record 29.7 million.
Italy's Jobless Rate Eases to 8.0%
Italy's seasonally adjusted jobless rate eased to 8.0% in the second quarter ending in June from 8.8% in the first quarter ending in March, Italy's statistics office Istat reported Tuesday.
Jobless rate in the similar period a year ago was 9.6%.
Total employment rate increased to 60.5% in the second quarter from 59.1% in the first quarter and the inactivity rate among the 15 to 64 age group declined to 34.2% from 35.1% in the previous quarter.
Spain's Inflation Eases but Stays Near Record High
Spain's inflation eased less than the previous estimate in August.
Consumer prices rose 10.5% in August from a 4-decade record of 10.8% in July, the Spain's statistics office INE reported Tuesday.
The inflation rate was previously estimated at 10.4% on August 30.
Core inflation, excluding non-processed food and energy, increased to 6.4% from 6.1% in July, record high since January 1993.
Housing costs soared 24.8% from a year ago, and prices of food and non-alcoholic beverages rose 13.8%.