The stock markets in the United States declined due to the protests in Hong Kong, which added to the geopolitical concerns. The increase in consumer spending also strengthened speculations that the Federal Reserve may implement an interest rate hire earlier than expected.
In a telephone interview with Bloomberg, Drew Wilson, an investment analyst at Fenimore Asset Management said. “There’s this sense of foreboding in the stock markets that we’re almost deserving of at least a correction.”
Wilson added, “Nobody wants to be in the way of that. We’ve had one tiger awaken in Russia, and now we have a tiger awakening in China and that’s a little too much risk and uncertainty for U.S. stock market investors to have on their plates.”
On the hand, Michael Block, chief equity strategist at Rhino Trading Partners LLC noted that the market is like a “giant yo-yo” over the past six session, but the Federal Reserve remained accommodative. He said, “We’re just hitting some bumps with macro issues.”
[drizzle]Today, the Department of Commerce reported that consumer spending increased 0.5% and personal income rose 0.3% in August. The spending for durable goods climbed 1.9% last month.
J.P Morgan Chase economist Michael Feroli opined that the latest consumer spending and income growth is “acceptable, but it would be nice to see some acceleration.”
- Dow Jones Industrial Average (DJIA)- 17,071.22 (-0.25%)
- S&P 500- 1,977.80 (-0.25%)
- NASDAQ- 4,505.85 (-0.14%)
- Russell 2000- 1,117.13 (-0.20%)
- EURO STOXX 50 Price EUR- 3,186.95 (-1.01%)
- FTSE 100 Index- 6,646.60 (-0.04%)
- Deutsche Borse AG German Stock Index DAX- 9,422.91 (-0.71%)
- Nikkei 225- 16,310.64 (+0.50%)
- Hong Kong Hang Seng Index- 23,229.21 (-1.90%)
- Shanghai Shenzhen CSI 300 Index- 2,447.80 (+0.43%)
Stocks in Focus
The stock price of Intel Corporation (NASDAQ:INTC) gained 1.87% to $34.90 per share driven by its partnership agreement with Mitsubishi Electric Corporation (TYO:6503) to develop next generation factory automation systems. The shares of Mitsubishi Electric also rose more than 2% to ¥1,484.50 in Tokyo.
VimpelCom Ltd (ADR) (NASDAQ:VIP) declined more than 6% to $7.15 per share after disclosing its agreement with Global Telecom Holding SAE-GDR (LON:GLTD) to sell all of their debt and equity interests in the Globalive group of companies in Canada.
HSBC Holdings plc (ADR) (NYSE:HSBC) dropped more than almost 3% to $51.56 per share after the company closed its branch in Mong Kok district, one of the most populated areas in Hong Kong.