Market Update June 25th, 2013 Equities U.S. stocks ended sharply lower overnight, following a 5.3% tumble in the Shanghai stock market yesterday spurred by worries over China’s economy and banking system. However, stocks on Wall Street pared some of their losses in the afternoon after Federal Reserve officials tried to downplay talk of tapering the central bank’s bond-buying program. Overnight Fed officials started making dovish comments starting with Minneapolis Fed President Narayana Kocherlakota who said the market’s reaction to Fed comments is not yet a concern as long as higher bond yields do not harden over a long period of time. Also, New York Fed President William Dudley said the Fed has fallen short of its inflation and employment objectives. Dudley said that Fed policy, while aggressive by historical standards, is not sufficiently accommodative. After dropping 248 points during the session, the Dow Jones closed down 139.84 points, or 0.9%, at 14,659.56. The S&P 500 index finished down 19.34 points, or 1.2%, at 1,573.09, with all of its 10 major sectors in negative terrain. The index posted an intraday low of 1,560.33 and a session high of 1,588.77 with materials and financials posting the biggest losses. Forex The U.S. Dollar Index traded at almost a two week high as investors fled higher yielding currencies in favour of the relative safety of dollar denominated assets. The U.S. Dollar Index, which Intercontinental Exchange Inc. uses to monitor the U.S. currency against those of six trading partners, rose 0.18% to 82.67. The U.S. dollar was little changed at $1.3120 per euro after earlier appreciating to the strongest level since June 5.The U.S. currency weakened 0.2% to 97.73 yen. The Canadian dollar weakened beyond C$1.05 per U.S. dollar to reach its lowest point in almost two years on bets the U.S. currency will strengthen when the Fed Reserve ends monetary stimulus. The CAD fell 0.4% to C$1.0501 per U.S. dollar.
Posted on: Tue, 25 Jun 2013 03:53:07 +0000
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