Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search


While you were sleeping: Investors on Fed watch

While you were sleeping: Investors on Fed watch

Aug 20 (BusinessDesk) – Equities and bonds fell as investors await signals from the US Federal Reserve, perhaps later this week, about plans to pare its bond-buying program.

First, on Wednesday in the US, minutes of the latest Fed meeting, held July 30-31, will be released. Bond watchers expect the Fed to pare the monthly target of purchases by US$15 billion to US$70 billion, in keeping with recent comments by Fed Chairman Ben Bernanke that the central bank wants to ease back this year and end bond buys by mid 2014.

But the Fed minutes aren't all that's on deck. Investors also will be eying this week's annual meeting of global central bankers and policy makers in Jackson Hole, Wyoming, for fresh indications about plans for monetary stimulus in the world's largest economies.

“The focus this week is on what’s going to happen with the Fed minutes and at Jackson Hole,” Niels From, chief analyst at Nordea Bank in Copenhagen, told Bloomberg News.

In late afternoon trading in New York, the Dow Jones Industrial Average fell 0.25 percent, while the Standard & Poor's 500 Index shed 0.30 percent. Declines in shares of JPMorgan Chase and Alcoa weighed on the Dow. The Nasdaq Composite Index rose 0.16 percent, helped by further gains in Apple.

US Treasuries fell, pushing yields on the benchmark 10-year bond four basis points higher to 2.86 percent. German government bond yields also are rising, having touched 1.92 percent overnight.

In Europe, the Stoxx 600 Index ended the day with a 0.5 percent drop from the previous close. Germany’s DAX declined 0.3 percent, the UK's FTSE 100 Index fell 0.5 percent, while France’s CAC 40 dropped 1 percent.

Germany's central bank, the Bundesbank, is forecasting steady growth for the nation after a strong second quarter where the economy expanded 0.7 percent.

Commodities including copper, silver and gold also fell amid expectations that a cutback in Fed stimulus might dampen demand for raw materials. Three-month copper on the London Metal Exchange closed 1.3 percent weaker at US$7,305 a tonne, according to Reuters.

In a paper released today, the Fed said large banks have more work to do to shore up their capital planning processes. In particular, the Fed said firms need to improve "their accounting for risks" to specific business activities.

The Fed will conduct its next review of the strength of US banks later this year. This year the Fed will review the finances of 30 banks, 18 of which participated earlier and 12 additional ones with more than US$50 billion in total assets.


© Scoop Media

Business Headlines | Sci-Tech Headlines


Grey Power: Is Disappointed To Learn Of More Bank Closures

Many older people are being left without essential services because of cost cutting and the march of modern technology. It is now expected that most banking transactions can occur via the internet or telephone. Jan Pentecost, President of the Grey Power ... More>>


Economy: Supply Chain On Brink Of Overload Says National Road Carriers

The New Zealand supply chain is on the brink of overload and it looks like the upcoming peak imports season may push it over the edge says National Road Carriers Association (NRC) CEO David Aitken. “Worldwide supply chains are in disarray,” says Mr Aitken. ... More>>

Retail: Supermarkets Announced As Government’s Second Market Study

The Government has today launched a market study to ensure New Zealanders are paying a fair price for groceries. More>>


Statistics New Zealand: Retail Sales Recover In The September 2020 Quarter

Retail sales values recorded the largest September quarter rise since the series began in 1995, Stats NZ said today. Spending on major household items, vehicles, and groceries contributed to the strong 7.4 percent ($1.8 billion) rise in total ... More>>

Kea Aerospace: New Zealand Flies Into The Stratosphere

Development has started on a solar-powered, unmanned aircraft that can fly in the stratosphere continuously for months at a time. The zero-emission aircraft will carry a suite of imagery equipment that will be game-changing for many industries, vastly ... More>>

Stats NZ: Births And Deaths: Year Ended September 2020

Births and deaths releases provide statistics on the number of births and deaths registered in New Zealand, and selected fertility and mortality rates. Key facts For the year ended September 2020: 57,753 live births and 32,670 deaths ... More>>


Forest & Bird: Kākāpō Wins Bird Of The Year 2020

The nation has voted and Aotearoa New Zealand has a new Bird of the Year. New Zealand’s moss-colored flightless parrot has climbed to the top-spot for the second time in Forest & Bird’s annual Te Manu Rongonui o Te Tau/Bird of the Year competition. ... More>>