Mid-Day Recap: Profit Taking Sends Stocks Lower
The first three hours of trading have been pretty light with all three indexes trading marginally lower, failing to move higher. Equities rallied on Friday after the nonfarm payrolls report showed job slashings were moderating, and with no major news on the docket today, investors are quietly selling to take profits.
A few minutes after 12:30, the S&P 500 is down 0.49% to 1005, while the Dow is 0.46% lower at 9326 and the Nasdaq is down 0.61% to 1988. Markets have been climbing rapidly over the past four weeks, with the S&P 500 over 14% higher since July 10, which helped the benchmark index hit a 9-month high last week.
No major headlines have hit the markets this morning. In fact, retail news this morning has been positive, which in a way confirms that the shallow sell-off today doesn’t reflect a real drop in sentiment.
McDonald’s said global sales improved 4.3% in July, beating analyst estimates. The fast food company said part of the increase was due to its successful marketing campaign to sell coffee-based drinks, which accounted for close to 5% of all sales.
The online travel agency Priceline.com also reported good news as revenue from travel bookings gained 13% compared to last year.
Later in the week the US dollar may be in the headlines, as in a client note this morning BMO analyst Douglas Porter noted that the greenback rallied after Friday’s nonfarm payrolls report, belying its reputation as the place to go to when risk sets in.
“Since the financial crisis broke wide open last fall, the US$ has tended to thrive as a safe haven amid really bad news, and soften on better economic news, even when it is U.S.-based good news,” Porter said. “That dynamic may have finally been broken last week.”
He continued: “That is, expect good U.S. economic news to support the US$ now, since the heart of the financial crisis has been passed.”
To confirm whether that’s true, check the greenback on Thursday when the week’s biggest release, the retail sales report, is released. Until then, market focus will be on the Federal Reserve’s two-day monetary policy meeting, which begins tomorrow.
All Content Copyright © 2003 – 2009 Brown House Media, Inc. All Rights Reserved.nReproduction in any form without permission of MortgageNewsDaily.com is prohibited.
Leave a Comment
By John Gittelsohn August 24, 2020, 4:00 AM PDT Some of the largest real estate investors are walking away from Read More...Late-Stage Delinquencies are Surging
Aug 21 2020, 11:59AM Like the report from Black Knight earlier today, the second quarter National Delinquency Survey from the Read More...Published by the Federal Reserve Bank of San Francisco
It was recently published by the Federal Reserve Bank of San Francisco, which is about as official as you can Read More...