The Shanghai Composite had its largest fall in over four years
today, dropping 5.3% as Chinese government continued to inject
liquidity to prop up its financial system. Fears of a credit crunch
have pushed the Chinese index lower for the past four trading days.
The major European markets were in the red as well. The
(INDEXFTSE:UKX) lost 2.12% on the day.
The Dallas Fed Manufacturing Survey came in better than expected
this month, coming in at 6.5 vs. the consensus 0.0. The
forward-looking new orders subindex rose to 13 from 6.2, and the
employment subindex rose to 0.2 from -6.3.
(INDEXSP:.INX) opened low and continued lower, trading down to as
low as $1,560. After the European closing bell, markets began to
recover and finished the day down 0.8%. The materials and
industrials sectors were the worst performing sectors, both down
more than 2%, with utility stocks around unchanged. Market breadth
remained very negative with declining stocks outnumbering advancing
socks on the NYSE 6.5 to 1.
The 10-year Treasury yield pushed past 2.6%, but came back down to
finish at 2.53%. Longest-duration Treasuries continued to be the
best performers as overall inflation expectations remain unchanged.
Crude recovered from recent losses, and finished the day up 1.5%.
The Gloom, Boom and Doom Report's editor Marc Faber announced today
that he believes the S&P 500 could fall 20% to 30% from current
Tomorrow's Financial Outlook
Italian retail sales will be released at 4:00 a.m. EDT tomorrow
US durable goods orders will be released at 8:30 a.m. EDT. New
orders are expected to see month-over-month growth of 3.3%. The
S&P/Case-Shiller home price index will be released at 9:00 a.m.
EDT tomorrow morning. Economists expect the 20-city seasonally
adjusted month-to-month growth to be 1.5%.
New home sales will be released at 10:00 a.m. EDT tomorrow morning.
The Street expects new sales to come in at 460,000 after seeing
454,000 last month. The consumer confidence index is expected to
report a reading of 75.0, after seeing a multi-year high reading
Apollo Group Inc
Barnes & Noble, Inc
) are all releasing their quarterly earnings reports tomorrow.