Stocks slide on lackluster growth as Yen advances
Thu May 05, 2016 11:45:am Business
2.6K By sosa hills
Global equities fell the most in a month and crude oil declined, while Treasuries surged with the dollar as evidence of limp economic growth around the world sparked a retreat from riskier assets.
U.S. stocks fell with global equities and treasuries surged with the yen as evidence of limp economic growth around the world sparked a retreat from riskier assets.
The S&P 500 tumbled to a three-week low, while Europe's main stock index slipped for a third day. The yield on the 10-year Treasury note plunged eight basis points to 1.79 percent.
The Japanese currency rose against all of its major counterparts except the Swiss franc. Gold advanced to a 15-month high and oil fell toward $44 a barrel. Copper dropped from the highest close in five weeks and the Australian dollar tumbled against its major peers after the central bank unexpectedly cut interest rates.
While monetary easing in the Asia-Pacific region and Europe helped global equities and commodities recover from multi year lows since February, economic data remain subdued, as highlighted Tuesday by Chinese and U.K. releases.
Citigroup Inc.'s Economic Surprise Index for the U.S., which measures the strength of data relative to analysts' forecasts, fell to its lowest level since February.
Corporate earnings are adding to the gloom, with analysts predicting an 8 percent decline in profits for companies in the S&P 500 Index.
"The continued narrative is that the global economy is not very strong, even if the U.S. is the best of the bunch," said Joe Bell, a Cincinnati based senior equity analyst at Schaeffer's Investment Research Inc.
"We've had such a strong run-up over the last few months that we're in a bit of a consolidation phase here."
U.S. stocks fell with global equities and treasuries surged with the yen as evidence of limp economic growth around the world sparked a retreat from riskier assets.
The S&P 500 tumbled to a three-week low, while Europe's main stock index slipped for a third day. The yield on the 10-year Treasury note plunged eight basis points to 1.79 percent.
The Japanese currency rose against all of its major counterparts except the Swiss franc. Gold advanced to a 15-month high and oil fell toward $44 a barrel. Copper dropped from the highest close in five weeks and the Australian dollar tumbled against its major peers after the central bank unexpectedly cut interest rates.
While monetary easing in the Asia-Pacific region and Europe helped global equities and commodities recover from multi year lows since February, economic data remain subdued, as highlighted Tuesday by Chinese and U.K. releases.
Citigroup Inc.'s Economic Surprise Index for the U.S., which measures the strength of data relative to analysts' forecasts, fell to its lowest level since February.
Corporate earnings are adding to the gloom, with analysts predicting an 8 percent decline in profits for companies in the S&P 500 Index.
"The continued narrative is that the global economy is not very strong, even if the U.S. is the best of the bunch," said Joe Bell, a Cincinnati based senior equity analyst at Schaeffer's Investment Research Inc.
"We've had such a strong run-up over the last few months that we're in a bit of a consolidation phase here."
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