Weak economic data at Wall Street impact stocks
U.S. stocks closed sharply lower on Monday, 22 September 2014 with the S&P 500 falling by its largest margin in nearly seven weeks. Data released on Monday, shows U.S. economic activity was lackluster in August. Sales of existing homes unexpectedly declined in August, for the first time in five months. Investors turned skittish as they fretted about falling commodity prices and concerns about global growth.
The Dow Jones Industrial Average dropped 107.06 points, or 0.6%, to 17,172.68. The Nasdaq Composite fell 52.10 points, or 1.1%, to 4,527.69. The S&P 500 closed 16.11 points, or 0.8%, lower at 1,994.29.
Five of ten sectors ended lower led by consumer discretionary, healthcare and energy sectors.
A decline in economic activity in August, measured by Chicago Federal Reserve as well as a drop in existing-home sales contributed to the dour Wall Street mood.
In overnight news, China's finance minister said his nation will not offer a more stimulative domestic monetary policy or other economic stimulus measures despite some recent weak economic data coming from the world's number-two economy. This news was seen as another bearish clue for the raw commodity sector. There is a key report on manufacturing activity in China due out on Tuesday.
There was a Group of 20 industrial nations meeting in Australia during the weekend. The G-20 pledged to continue to work to boost global economic growth. The group said present world economic growth levels are uneven and below levels deemed healthy. The group also said the inflation rate in the European Union is dangerously low.
Also Read
On the geopolitical front it has been quieter the past few weeks. That has pushed commodities' prices lower.
U.S. economic data released Monday included the Chicago Fed national activity index and existing home sales. Neither report had a significant impact on the precious metals markets.
Existing Home Sales for August fell 1.8% to 5.05 million SAAR from a slightly downwardly revised 5.14 million SAAR (from 5.15 million SAAR) in July, while the consensus expected an increase to 5.20 million. The report revealed the first monthly drop in sales since March and overall sales are still down 5.3% year-over-year.
Amomg stocks under focus, Alibaba shares fell 4.3% on the second day of trading. With the e-commerce company's underwriters set to exercise an option to sell additional shares, the IPO is now officially the world's largest. Shares in Apple closed slightly higher after the company said iPhone 6 sales topped 10 million during the first weekend, a new Apple record.
Bullion metals ended in a ixed mode on Monday, 22 September 2014 at Comex. Silver prices hit four-year lows on Monday, while gold prices recovered to snap a four-session losing streak, supported by a weak stock market. U.S. equities were pressured by softer U.S economic data, including a drop in existing home sales.
Gold for December delivery rose $1.30 to settle at $1,217.90 an ounce. December silver was off 8 cents, or 0.5%, to $17.70 an ounce.
Crude-oil futures edged lower on Monday, 22 September 2014 at Nymex as investors stayed on the sidelines ahead of economic data due later this week. A fourteen month high dollar pressured prices.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in October traded at $92.01 a barrel at last check, down $0.40 in the Globex electronic session. Nymex crude for October delivery is due for expiry later Monday.
Treasuries ended near their highs after spending the day in the green. The 10-yr yield slipped one basis point to 2.56%.
Participation was in line with recent averages as more than 680 million shares changed hands at the NYSE.
Tomorrow, the July FHFA Housing Price Index will be released at 9:00 ET.
Powered by Capital Market - Live News