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Stock Market News: August 23, 2019



<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "US stocks fell in unstable session after trading , after President Donald Trump & nbsp; wrote in a series of Twitter posts & nbsp; that he would order US companies to "immediately start looking for an alternative" to their business operations in China. " -reactid = "15"> US stocks fell into an unstable stock trade after President Donald Trump wrote in a series of Twitter posts that he would order US companies to "immediately start looking for an alternative "to their business operations in China. [19659002] This comes after China announced during the pre-market trade session that it would impose tariffs on additional US goods in return for the Trump administration's fees to come into force on September 1.

China's finance ministry said in a statement that it would introduce tariffs on a further $ 75 billion US goods, which will be rolled out in two lots on September 1 and December 15. The Trump administration has also previously announced that some Chinese import tariffs would come into force on September 1, while others would hit in mid-December.

Here were the main features of the market from 14:02 ET.

  • S&P 500 (^ GSPC): -2.01%, or 58.87 points

  • Dow (^ DJI): -1.89%, or 495 points

  • Nasdaq (^ IXIC): -2 , 56%, or 204.51 points

  • 10-year Treasury Rate (^ TNX): -9.7 bps to 1.513%

<p class = "canvas-atom canvas text Mb (1.0 em) Mb (0) – sm Mt (0.8em) – sm "type =" text "content =" Less than an hour before Trump's tweets, shares had been positive after Federal Reserve leader Jerome Powell called out "" significant risks " & nbsp; to the US economy and repeated a promise to "act as appropriate to sustain enlargement." Investors largely took this assessment to mean that the Fed leader was still open to the idea of ​​simpler monetary policy to help keep the economy afloat. "data-reactid =" 24 "> Less than an hour before Trump's tweets, shares had been positive after Federal Reserve leader Jerome Powell called for" significant risks "to the US economy and repeated a pledge to" act as appropriate to maintain the expansion. Investors largely took this assessment to mean that the Fed leader was still open to the idea of ​​simpler monetary policy to help keep the economy humming.

Powell's prepared comments, delivered at the Fed's annual Jackson Hole Economic Policy Symposium, came about a month before the Federal Reserve's next monetary policy meeting, which market players have hoped will result in the first of several more interest rate cuts.

The Fed's justification for the interest rate cut in July had centered on averting global economic risk, and increasing it Now there has been sustained low inflation in the United States. Both factors still playing a month later, these could serve as a basis for yet another interest rate cut to support the domestic economy.

"The [Powell’s] speech shows that the biggest factor driving both market volatility, the actual global downturn and the fear of a US downturn is trade policy, both its current stance and uncertainty about the future," wrote Ian Shepherdson, chief economist for Pantheon Macroeconomics, in a note. "In other words, the Fed has been handicapped by Trump's pernicious and capricious trade policy, which has made it very difficult for monetary policy makers to make a definite view of where the economy is headed."

But the market's belief that further interest rate cuts are on the rise has itself created a risk, other analysts pointed out.

"To keep the expansion going, the Fed has boxed to deliver more interest rate cuts this year," Scott Minerd, Guggenheim's chairman Investments, wrote in a note Friday, "This could lead to an increase in risk distributions based on the market's perception that liquidity will be plentiful over the such a period of relief by the Fed. "

Such a response should reflect that in the late 1990s, when the Fed swung from tightening to relief as a result of the Asian financial crisis – which led investors to pump up risk benefits, and especially tech stocks, Minerd added.

Traders working on the floor of the New York Stock Exchange (NYSE) in New York, USA, August 14, 2019. REUTERS / Eduardo Munoz

When It Is That said, a number of regional Fed presidents earlier this week dampened hopes of further policy relief.

<p class = "canvas atom canvas text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" con telt = "Kansas City Fed President & nbsp; Esther George told Yahoo Finance on Thursday & nbsp; that "cutting interest rates will not solve any uncertainty" around trading, adding that she monitored US economic data before committing to a next move in monetary policy. "data-reactid =" 43 "> Kansas City Fed President Esther George told Yahoo Finance Thursday that" cutting interest rates will not solve any uncertainty "around trading, adding that she monitored US economic data before committing to a next move in monetary policy.

<p class = "canvas atom canvas text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "George had been one of two dissents from the Feds decision in July to cut interest rates. The other dissenter – Boston Fed's Eric Rosengren – also suggested that he opposed deeper interest rates, in & nbsp; an interview earlier in August with Bloomberg . "44"> George had been one of two dissenters from the Fed's July decision to cut interest rates. The other dissenter – the Boston Fed's Eric Rosengren – has also hinted that he countered deeper interest rates, in an interview earlier in August with Bloomberg.

However, comments from other Fed presidents at Jackson Hole this week suggested that central bank officials considering a rate cut have mounted.

<p class = "canvas atomic canvas text Mb (1.0em) Mb (0) – sm Mt (0.8 em) – sm" type = "text" content = "Philadelphia Fed leader & nbsp; Patrick Harker told CNBC on Thursday & nbsp; that he agreed that Julie's interest rate cut was "somewhat reluctant," and said he thinks "we should stay here for a while" on prices. however, is not a voting member of the Federal Open Market Committee, but he will continue to be part of the deliberation process during this year's Fed meetings. "Data-reactid =" 50 "> Philadelphia Fed leader Patrick Harker told CNBC Thursday that he joined on reducing interest rates in July just "somewhat reluctantly," and said he thinks "we should be here for a while" on interest rates. However, Harker is not a voting member of the Federal Open Market Committee, but he will continue to be part of the deliberation process during this year's Fed meetings.

Detailed routine

<p class = "canvas-atom canvas text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "This week's composition of results to retail ended a dizzy, with quarterly reports from The Gap ( GPS ) and Foot Locker ( FL ) that fell short of expectations. "data-reactid =" 52 "> This This week's series of retail results ended in a hurry, with quarterly reports from The Gap (G PS) and Foot Locker (FL) falling below expectations.

Foot Locker on Friday reported sales results as a barrier to consensus expectations. Compared to the same sales, 0.8% increased, compared to an expected increase of 3.3%. Adjusted earnings were SEK 66 per share on a turnover of $ 1.77 billion, and failed to meet expectations of adjusted EPS of NOK 67 on sales of $ 1.82 billion.

<p class = "canvas-atom canvas text Mb (1.0 cm) Mb (0) – sm Mt (0.8 cm) – sm" type = "text" content = "" While our results in the second quarter came in at the low end of our expectations, so we saw better results as we moved through each month of the quarter, "Foot Locker CEO Richard Johnson said in a statement. " We are still deeply connected to sneaker and youth culture, and believe this positive progress from the quarter has positioned us well for the return to school period and beyond. "" data-reactid = "54"> "While the results in the second quarter came in at the low end of our expectations, we saw improvement in our results as we went through each month of the quarter," said Foot Locker CEO Richard Johnson, in a statement. "We remain deeply connected to sneakers and youth culture, and believe this positive momentum coming out of the quarter has us well positioned for school hours and beyond."


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