Bloomberg
Published Oct 24, 2018 11:12
Updated Oct 24, 2018 11:47
U.S. Stocks Slump Deepens on Peak-Profit Concerns: Markets Wrap
(Bloomberg) -- U.S. stocks extended losses for a sixth day, led by declines in communication services and technology companies, as concern lingers that profit growth has peaked and tariffs weigh on optimism. The dollar strengthened as a weaker-than-expected manufacturing gauge reading in Europe helped undercut the euro.
The S&P 500 Index traded near the lows of the day, hurt as disappointing earnings from AT&T (NYSE:T) Corp. and Texas Instruments (NASDAQ:TXN) Inc. The Dow Jones Industrial Average got an initial boost before fading after its biggest component by weighting, Boeing (NYSE:BA) Co., rallied on a positive profit forecast. Shares of home builders slumped after new home sales fell more than expected, showing that the consequences of higher interest rates are trickling down to the consumer.
“There’s just right now a heightened sensitivity to what can go wrong,” Kate Warne, investment strategist at Edward D. Jones & Co., said in an interview at Bloomberg’s New York headquarters. “So we will have more of these days where stocks move a lot within the day as everyone’s trying to sort through what do today’s reports mean.”
The pound weakened on Brexit worries, and European bonds followed Treasuries higher. The euro dropped following disappointing manufacturing data.
Sentiment remains fragile as global shares chart a course for the worst month in more than three years. The cautious mood was further damped by renewed worries over the impact of tariffs after industrial bellwether Caterpillar Inc (NYSE:CAT). warned about rising costs due to higher steel prices. European politics is also in focus, with Italian Prime Minister Giuseppe Conte doubling down on his government’s budget and U.K. Prime Minister Theresa May’s cabinet descending into conflict.
Retailers were the biggest winners in the Stoxx Europe 600 Index. A turnaround in China’s markets helped the MSCI Asia Pacific Index avoid a bear market even as it edged down.
“Right now markets are still trying to reprice,” said Chris Zaccarelli, chief investment officer at the Independent Advisor Alliance. “What’s happening with earnings is exaggerating market moves.”
Elsewhere, oil rebounded after touching the lowest in almost two-months on a pledge by Saudi Arabia to meet any shortfall that materializes from Iranian sanctions. Emerging-market currencies and shares climbed.
Here are some key events coming up this week:
These are the main moves in markets:
Stocks
Currencies
Bonds
Commodities
Written By: Bloomberg
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