Tuesday's Market Recap - Stock Slumped On Fear Of Weak Global Growth Forecast.
What is The Premarket Telling Us?
7:00 AM.
Red, Red, the futures are red on this the first trading day of the new week. Markets were closed yesterday, for celebration of the Martin Luther King Jnr. holiday. Dow futures are down 133 points, Nasdaq futures down 52 points, and S&P futures down 16 points. While we were closed on Monday Major Asian markets closed nicely higher. However they gave up chunk of those gains in trading overnight.
Financial movers & shakers, hedge fund managers, global leaders, and economist are at the annual World Economic Forum, taking place this week in Davos, Switzerland.
On The Bond Desk:
The US 10 Year Bond Yield at 2.78%, up 0.03%.
Currency Desk:
Euro dollar: 1.13
UK Pound: 1.28
Crude Oil:
WTI crude oil futures at $53.08/barrel, down 1.78%.
On the Earnings Calendar:
IBM reports after the closing bell this evening.
In M&A News:
None.
What About The Asian And European Markets?
Major Asian markets were lower on Tuesday. Japan (Nikkei 225) fell 0.47%, Shanghai down 1.18%, Hong Kong (Hang Seng) gave up 0.70%
Major European markets also traded lower. German (DAX) down 0.41%, France CAC 40 off by 0.42%, London FTSE 100 down 0.99%.
Market And Sector Dynamics
Stocks opened the trading day down big. The Dow lost 150 points, Nasdaq down 50 points, and S&P down 16 points. Global economic weakness appears to be the main culprit. China reported annual GDP of 6.6% for 2018, a performance that would be coveted by any developed country, but for China, it represents slowing growth. The IMF has also cut its forecast for global growth rate from 3.7%, to 3.5%.
A lower global growth rate forecast, is also affecting crude oil prices, with WTI crude trading at $52.69/barrel, down 2.06% in early trading. The Industrials, and Basic Material sectors are bearing the brunt of the early losses.
Markets fell progressively during today's session, as negative sentiment around global trade deteriorated. At the low of the day the Dow was down almost 500 points. Stock did cut some of the earlier losses, after Larry Kudlow, appeared on CNBC, to refute an earlier story that the Administration, did not turned down a scheduled meeting with Chinese trade officials, because of lack of enough progress from the Chinese.
Today's selloff was broad based, with eleven of the S&P sectors closed the session with solid losses. Energy, Industrials, Communication Services, Consumer Discretionary, Technology, Basic Materials, Financials, and Consumer Staples, were the hardest hit sectors. Utilities closes modestly higher.
Factors Influencing Today's Market
China's annual GDP for 2018 came in at 6.6%, slightly lighter than expected.
The International Monetary Fund reduced it global growth forecast from 3.7%, to 3.50%.
IBM and reported better than expected Q4 Earnings performance. Share of both company rose in the aftermarket.
World Ecomomic Conference continues in Davos, Switzerland. Global, industrial, financial, and academic leaders, are trying to guage the state of and risks to the global economy, for 2019, and beyond.
Crude oil fell significantly today. WTI crude oil closed at $52.57/barrel, down 3.08%.
Major Asian and European market lost ground in their sessions.
Market Close Volume Traded And Advance Decline Ratio
At the end of trading the Dow sank 301.87 points Nasdaq fell 136.87 points, and the S&P lost 37.81. Total NYSE volume traded, a modest 3.85 billion shares. Declining shares outpaced Advancing share nearly 4:1.
Data Sources: Bloomberg, CNBC, CNN Money, Google Finance, Market Watch, TD Ameritrade, Yahoo Finance.
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