Wednesday, July 3, 2013

Investors shrug off global turmoil

Benchmark stock indexes were modestly lower Wednesday despite political and economic developments in Egypt, Portugal and China that sent markets sharply lower in Europe and Asia.
In morning trading, the Dow Jones industrial average was down around 0.1% while the Standard & Poor's 500 index was off about 0.4%. The Nasdaq composite was down about 0.1% at the opening bell.The yield on the 10-year Treasury note edged lower to 2.47%.
In observance of the July Fourth holiday, the stock market will close at 1 p.m. ET Wednesday and the bond market will also close earlier.
OIL: Egypt crisis boosts oil prices
Weighing on investor sentiment Wednesday:
• European markets in turmoil as new debt crisis pressures in Portugal and Greece sent stocks sharply lower. Benchmark indexes across Europe 
were sharply lower after Portugal's key stock index plummeted more than 5%. Britain's FTSE 100 index fell 1.4%, Germany's DAX 30 index fell 1.4%, France's CAC 40index fell about 1.3%, Spain's IBEX 35 dropped 1.8%. There are fears of a government collapse in Portugal. And a credit downgrade of three of Europe's biggest banks added to investor anxiety.
• Oil prices briefly rose above $102 per barrel Friday as millions of protesters in Egypt demanded that the president resign, and the Egyptian army issued a threatening deadline for protesters to leave the streets of Cairo.The price of crude oil hits its highest level in more than a year. Benchmark crude for August delivery was up $1.87 to $101.47 a barrel in electronic trading on the New York Mercantile Exchange, the highest since early May 2012.
• A new economic report in China showed the nation's growth continues to slow, which could negatively affect growth in the U.S. and Europe. The global economic slowdown depressed U.S. exports, growing the trade deficit by 12.1%, its highest level since November 2012.
• On Friday, the June employment report is set to be released. The closely followed report, which includes the nation's unemployment rate and the number of nonfarm jobs added to payrolls monthly, could support the Federal Reserve's expectation that the economy is strong enough to pull back later this year or early in 2014 its massive bond buying stimulus.
On Tuesday, the Dow fell 0.3% to close at 14,932.41. The S&P 500 closed down 0.1% at 1,614.08. The Nasdaq slipped a fraction of a percentage point to 3,433.40.
In Asia, Japan's Nikkei 225 edged down 0.3% to 14,055.56 and Hong Kong's Hang Seng dropped 2.5% to 20,147.31. Seoul's Kospi was down 1.6% to 1,824.66. In China, the Shanghai composite lost 0.6% to 1,994.27.


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