While you were sleeping: Wall Street declines
March 12 (BusinessDesk) – Wall Street slid amid ongoing concern about an international standoff about Ukraine, while copper continued its slump because of worries about the slowing pace of growth and more corporate bond defaults in China.
Increasing tension between the US, the European Union and Russia about Ukraine remains a concern for investors. While that has weighed on equities, it increased the appeal of gold as a safe haven investment. Gold futures for April delivery rose 0.4 percent to US$1,347 an ounce in late morning trading on the Comex in New York.
In afternoon trading in New York, the Dow Jones Industrial Average slid 0.28 percent, the Standard & Poor’s 500 Index fell 0.33 percent, while the Nasdaq Composite Index gave up 0.26 percent.
Shares of DuPont and Exxon Mobil fell, both down 1.9 percent, and led the decline in the Dow.
“The equity market is going to make continued progress in a two steps forward, one step back kind of progression,” Jim Russell, a senior equity strategist for US Bank Wealth Management, told Bloomberg News. “We’re still evaluating how much of the economic weakness is weather-related and how much of it is legitimate.”
The latest US economic data offered signs of strength. Wholesale inventories increased 0.6 percent to US$521 billion in January, following a revised 0.4 percent gain in December, according to Commerce Department data.
The US Treasury garnered solid demand for an auction of three-year notes. The sale drew a yield of 0.802 percent, the highest yield at an auction of the securities in six months, Bloomberg reported.
In Europe, the Stoxx 600 Index inched higher to close the session at 331.49. Germany’s DAX gained 0.5 percent. The UK’s FTSE 100 slipped less than 0.1 percent, while France’s CAC 40 dropped 0.5 percent.
German exports climbed more than expected in January, increasing 2.2 percent, while imports were also better than anticipated, rising 4.1 percent, a report showed.
A corporate bond default earlier this week exacerbated concern that China’s economic health is crumbling. Copper has been hit hard, touching the lowest level in nearly four years earlier today, and might slide further. Three-month copper on the London Metal Exchange closed down 2.6 percent at US$6,475 a tonne.
"There is still room to fall. You have broken below that significant support, so the next support you could argue is US$6,200," analyst Andrey Kryuchenkov at VTB Capital told Reuters.