The stock markets in the United States declined as investors look for signs as to when the Federal Reserve will start increasing interest rates. Investors are also weighing Greece’s debt negotiations with the leaders of the European Union and the International Monetary Fund (IMF).
Commenting on the movement of the equity markets, Peter Dixon, an economist at Commerzbank told Bloomberg, “Investors want to see stronger growth and they are still trying to figure out when the Fed is likely to move, and that’s a good three months away.”
Dixon also noted that the equities recently experienced a good run as investors took a bit of risk off the table. He added that investors are “standing on the sidelines deciding how to play” under the current economic situation.
Last Friday, the Department of Labor reported that the economy created 280,000 jobs, and the average hourly earnings increased by eight cents, the largest wage increase since August 2013.
The IMF urged the Federal Reserve to delay raising interest rates until the first half of 2016 citing the reason that the inflation is not progressing at a rate that would warrant a rate hike, without a risk, in the next few months.
Andrew Brenner, head of international fixed income at National Alliance Capital Market commented, “People talk about how equities have done well six months after tightening, but the Fed has never been at zero for this long
Meanwhile, investors are looking for any sign of progress in the debt negotiations, which resumes on Monday, between Greece and its creditors. It’s inevitable an equity correction is coming.”
Meanwhile, Greece will resume its debt negotiations with international creditors on Monday. Investors will look for sign of progress on the issue. People familiar with the talk said Greece’s international creditors are considering extending the country’s bailout program until the end of March 2016.
- Dow Jones Industrial Average (DJIA) – 17,767.85 (-0.46%)
- S&P 500- 2,079.41 (-0.64%)
- NASDAQ- 5,021.63 (-0.92%)
- Russell 2000- 1,255.89 (-0.41%)
- EURO STOXX 50 Price EUR- 3,468.31 (-1.19%)
- FTSE 100 Index- 6,790.04 (-0.21%)
- Deutsche Borse AG German Stock Index DAX- 11,064.92 (-1.18%)
- Nikkei 225- 20,457.19 (-0.02%)
- Hong Kong Hang Seng Index- 27,316.28 (+0.21%)
- Shanghai Shenzhen CSI 300 Index- 5,353.75 (+2.34%)
Stocks in Focus
The stock price of Deutsche Bank increased almost 5% to $32.15 per share in New York. The bank announced the appointment of John Cryan as co-Chief Executive Officer after Jürgen Fitschen and Anshu Jain decided to step down from their positions.
The shares of MannKind surged more than 17% to $7.20 per share. Jefferies analyst, Shaunak Deepal reiterated his Buy rating on the stock with a price target of $9 per share. Investors were also optimistic regarding some developments related to its newly-launched insulin product called Afrezza. The early reviews by doctors and users on Afrezza were positive.
The shares of POZEN increased more than 18% to $8.97 per share. The pharmaceutical company focused on developing drugs to treat acute and chronic pain. The company acquired Tribute Pharmaceuticals Canada for approximately $146 million.