News Column

U.S. Stocks Take Biggest Hit Since June

August 7, 2013
bear market

U.S. stock indexes dropped the most in 5 1/2 weeks Tuesday after Federal Reserve officials said the central bank might soon start cutting its easy-money policy.

The Dow Jones industrial average fell 93.39 points, or 0.6 percent, to close at 15,518.74, its biggest point and percentage decline since June 28.

The Standard & Poor's 500 index dropped 9.77 points, or 0.6 percent, at 1,697.37. The technology-heavy Nasdaq composite index fell 27.18 points, or 0.8 percent, at 3,665.77.

About 3.4 billion shares traded hands on the New York Stock Exchange. Declining issues outnumbered advancers 3 to 1.

The sell-off followed a comment by Chicago Fed President Charles Evans, who told reporters he wouldn't rule out the central bank curtailing its $85 billion-a-month bond-buying program at its September policy meeting. Atlanta Fed Bank President Dennis Lockhart made a similar comment earlier Tuesday.

Dallas Fed President Richard Fisher mentioned a possible September start date when he spoke Monday.

The 10-year Treasury note Monday rose 0.004 to yield 2.645 percent.

In Asia, Hong Kong's Hang Seng Index closed down 298.31 points, or 1.3 percent, at 21,923.70. HSBC Holdings PLC, which accounts for about 15 percent of the index, issued a disappointing earnings report.

Japan's Nikkei 225 stock index bucked the broader downward trend, rising 143.02 points, or 1 percent, to close at 14,401.06.

European markets erased earlier gains and fell after Lockhart's comments.

Britain's FTSE 100 index lost 15.37, or 0.23 percent, at 6,604.21.

The Stoxx Europe 600, which represents companies across 18 European countries, finished down 1.24, or 0.4 percent, after trading up as much as 0.3 percent earlier in the day, to close at 303.5.

Crude oil for September delivery fell $1.26, or 1.2 percent, to settle at $105.30 a barrel on the New York Mercantile Exchange after briefly trading in positive territory.

August gold futures fell below the psychologically significant $1,300-an-ounce mark, dropping $19.90, or 1.6 percent, to settle at $1,282.50 an ounce on the New York Mercantile Exchange. Tuesday's decline was the sixth in a row.

Silver for September delivery slipped 20 cents, or 1 percent, to end at $19.52 an ounce.

The U.S. dollar fell against most major currencies.

The dollar fell to 97.76 Japanese yen, down from 98.30 in late New York trading Monday. It traded as low as 97.51 yen, its lowest since June 26.

The euro rose above $1.33 Tuesday to $1.331 late Tuesday, up from $1.326 late Monday.

On the Chicago Board of Trade, August soybeans fell 5.5 cents, or 0.4 percent, at $13.2425 a bushel. November soybeans fell 16 cents, or 1.4 percent, at $11.6725 a bushel.

September corn futures ended up 3 cents, or 0.6 percent, to $4.7225 a bushel. Food-processing and commodities-trading giant Archer Daniels Midland Co. said earlier Tuesday a delayed U.S. corn harvest was expected to create excess demand.

Wheat gained 5.3 cents, or 0.8 percent, to close at $6.505 a bushel.




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Source: Copyright UPI 2013


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