The Federal Reserve should avoid removing support for the USA economy too quickly, Fed Governor Lael Brainard said on Monday, Sept. 12, in comments that solidified the view the central bank would leave interest rates unchanged next week.
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KEEPING SCORE: Japan’s benchmark Nikkei 225 lost 0.2 percent in morning trading to 16,689.31. Holdings in gold-backed exchange traded funds added 0.6 metric ton to 2,020.3 tons on Monday, data compiled by Bloomberg show. Dow futures and the broader S&P 500 futures are expected to open 0.6 percent lower. Futures on the S&P 500 were trading sharply lower in pre-market activity, prompting a selloff at the start of NY trading.
ENERGY: The price of oil recovered some of its 3 percent overnight drop which followed the International Energy Agency’s remarks about oil demand because of a slowdown in the global economy.
But the gains faded away after the International Energy Agency warned that the global oil supply glut would last into next year instead of ending this year as it previously thought as oil demand growth was slowing while supply was rising.
October natural gas contracts were down a penny at US$2.91 per mmBtu and December copper prices were unchanged at US$2.10 a pound.
The stock was the only gainer on the Dow and chiefly responsible for the tech sector falling the least, 0.25 percent, among the 10 major S&P sectors.
The majority of economists still believe interest rates will be cut lower, however. Brent crude, the benchmark for worldwide oil trading, lost 56 cents to $47.76 a barrel in London. Verizon shed $1.31, or 2.5 percent, to $51.26 and AT&T fell 85 cents, or 2.1 percent, to $39.86. Intersil climbed $1.94, or 9.8 percent, to $21.70. Apple was one of the few stocks that traded higher Tuesday. It rose $2.52, or 2.4 percent, to $107.96 after T-Mobile said preorders for Apple’s newest iPhones, introduced last week, are the strongest it has seen so far. Renesas’ offer values Intersil at $22.50 per share, or $3.05 billion. The stock has given up some of its gains lately.
Spot silver was up 0.3 per cent at $18.90 an ounce.
The dollar index, which measures the greenback against a group of six major currencies, hit a one-week high of 95.672 as U.S. Treasury yields surged on what analysts said were growing expectations for a December Fed rate increase. The euro remained at $1.1241. However, the Hang Seng index in Hong Kong lost 0.3 percent.
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Stocks in Asia closed mixed (http://www.marketwatch.com/story/asian-stocks-bounce-back-from-mondays-beating-2016-09-12), while European equities (http://www.marketwatch.com/story/european-stocks-seesaw-as-oil-group-shoved-lower-2016-09-13) struggled for direction.
