AI
Friday, June 21, 2013 2:20:49 AM
S&P 500 Posts Biggest Drop Since November 2011 on Fed
as global equities tumbled after the Federal Reserve said it may phase out stimulus and China’s cash crunch worsened.
Fed Chairman Ben S. Bernanke said the central bank may end bond purchases by the middle of next year if the U.S. economy improves in line with Fed projections. His speech followed a two-day Federal Open Market Committee meeting in Washington.
Bernanke will cut the Fed’s $85 billion in monthly bond purchases by $20 billion at the Sept. 17-18 policy meeting, according to 44 percent of economists in a Bloomberg survey. In a June 4-5 survey, only 27 percent of economists forecast tapering would start in September.
http://www.bloomberg.com/news/2013-06-20/u-s-stock-index-futures-decline-barrick-retreats.html
Equities ended with sharp losses across the board as yesterday's selling persisted into today's trade, and dragged global shares into the fray. The S&P 500 fell 2.5% after losing its 50-day moving average at the open.
Markets across the globe sold off after yesterday's comments from Federal Reserve Chairman Ben Bernanke were interpreted as a warning of an impending modification to the Fed's asset purchase program. Although the Fed Chairman qualified his statement by saying the economy must continue showing improvement before modifications can be made, investors looked past this condition and chose to focus on the potential timeframe instead.
Concerns regarding possible tapering, as well as worries about the Fed losing control over the situation, have caused a significant spike in interest rates. Since yesterday, the yield on the 10-yr note has jumped 25 basis points to 2.414%, with ten of those coming during today's session.
Elevated Treasury yields have contributed to selling in high-yielding, defensively oriented sectors. To that end, the consumer staples sector led to the downside with a loss of 3.0%. Health care (-2.6%) and utilities (-2.9%) also saw significant selling while the fourth countercyclical group, telecom services, outperformed with a loss of 2.3% after leading yesterday's decline with a 2.7% slide.
Meanwhile, commodity-related names saw the heaviest selling among cyclical sectors with energy and materials dropping 2.7% and 2.6%, respectively. On a related note, crude oil slumped 3.6% to $94.98 per barrel while copper tumbled 3.0% to $3.05 per pound. Precious metals had a flashback to mid-April as gold sank 6.8% to $1280.10 per ounce while silver dropped 9.4% to $19.59
as global equities tumbled after the Federal Reserve said it may phase out stimulus and China’s cash crunch worsened.
Fed Chairman Ben S. Bernanke said the central bank may end bond purchases by the middle of next year if the U.S. economy improves in line with Fed projections. His speech followed a two-day Federal Open Market Committee meeting in Washington.
Bernanke will cut the Fed’s $85 billion in monthly bond purchases by $20 billion at the Sept. 17-18 policy meeting, according to 44 percent of economists in a Bloomberg survey. In a June 4-5 survey, only 27 percent of economists forecast tapering would start in September.
http://www.bloomberg.com/news/2013-06-20/u-s-stock-index-futures-decline-barrick-retreats.html
Equities ended with sharp losses across the board as yesterday's selling persisted into today's trade, and dragged global shares into the fray. The S&P 500 fell 2.5% after losing its 50-day moving average at the open.
Markets across the globe sold off after yesterday's comments from Federal Reserve Chairman Ben Bernanke were interpreted as a warning of an impending modification to the Fed's asset purchase program. Although the Fed Chairman qualified his statement by saying the economy must continue showing improvement before modifications can be made, investors looked past this condition and chose to focus on the potential timeframe instead.
Concerns regarding possible tapering, as well as worries about the Fed losing control over the situation, have caused a significant spike in interest rates. Since yesterday, the yield on the 10-yr note has jumped 25 basis points to 2.414%, with ten of those coming during today's session.
Elevated Treasury yields have contributed to selling in high-yielding, defensively oriented sectors. To that end, the consumer staples sector led to the downside with a loss of 3.0%. Health care (-2.6%) and utilities (-2.9%) also saw significant selling while the fourth countercyclical group, telecom services, outperformed with a loss of 2.3% after leading yesterday's decline with a 2.7% slide.
Meanwhile, commodity-related names saw the heaviest selling among cyclical sectors with energy and materials dropping 2.7% and 2.6%, respectively. On a related note, crude oil slumped 3.6% to $94.98 per barrel while copper tumbled 3.0% to $3.05 per pound. Precious metals had a flashback to mid-April as gold sank 6.8% to $1280.10 per ounce while silver dropped 9.4% to $19.59
My post is for my entertainment, do your own DD before pushing your
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