Stock markets in the United States sustained another decline today after the World Bank lowered its projections for global economic growth. Meanwhile, investors continue to weigh the valuation of equities. The World Bank forecast that the global economy will expand by 2.8% this year, lower than its 3.2% estimate last January. It also projected that the global economy will grow by 3.4% in 2015 and 3.5% the following year.
The economies of high-income countries are expected to grow by 1.9% this year despite the weakness of the U.S. economy during the first quarter, according to the World Bank. The Eurozone is expected to expand by 1.1%, while the United States is expected to grow by 2.1% in 2014. The estimated U.S. economic growth is lower than the previous forecast of 2.8%.
Commenting on the movement of the markets today, Robert Pavlik, chief market strategist at Banyan Partners LLC, told Bloomberg, “That negative movement is the World Bank adding pressure with concerns about growth. People are tentative with a market that’s trading near all-time highs with low growth prospects.
U.S. Markets
- Dow Jones Industrial Average (DJIA)- 16,844.65 (-0.60%)
- S&P 500- 1,943.95 (-0.35 %)
- NASDAQ- 4,331.93 (-0.14%)
- Russell 2000- 1,167.47 (-0.45%)
European Markets
- EURO STOXX 50 Price EUR- 3,289.09 (-0.75%)
- FTSE 100 Index- 6,838.87 (-0.50%)
- Deutsche Borse AG German Stock Index DAX- 9,949.81 (-0.79%)
Asia-Pacific Markets
- Nikkei 225- 15,069.48 (+0.50%)
- Hong Kong Hang Seng Index- 23,257.29 (-0.25%)
- Shanghai Shenzhen CSI 300 Index- 2,160.77 (-0.02%)
Stocks in Focus
The stock price of Bank of America Corp (NYSE:BAC) declined more than 2% to $15.59 per share on a report that the Department of Justice (DOJ) is seeking around $17 billion to settle its investigation against the bank regarding its management of mortgages prior to the financial crisis.
Synaptics, Incorporated (NASDAQ:SYNA) climbed almost 29% to $85.78 per share after the company entered an agreement to acquire Renesas SP Drivers, the maker of chips for smartphones and tablets for $475 million. In a statement, Synaptics, Incorporated (NASDAQ:SYNA) CEO Rick Bergman said, “Upon closing the acquisition, we will have the scale to accelerate our technology roadmap and expand our broad portfolio of human interface product families including display integration solutions.”
The stock value of Orexigen Therapeutics, Inc. (NASDAQ:OREX) dropped more than 14% to $5.81 per share after the biopharmaceutical company revealed that the Food and Drug Administration’s (FDA) review of its new weight loss drug will take another three months.
