Emerg­ing stocks jump, US shares lower

Kuwait Times - - BUSINESS -

NEW YORK: US stocks opened lower yes­ter­day, weighed down by earn­ings re­ports from some big names and con­cerns over Pres­i­dent Donald Trump's abil­ity to push through his pro-growth poli­cies, fol­low­ing a set­back to the health­care bill.

Shares of Bank of Amer­ica slipped 0.8 per­cent, while Gold­man Sachs was down 0.9 per­cent af­ter re­port­ing quar­terly re­sults. Last week, shares of JPMor­gan, Wells Fargo and Cit­i­group had taken a beat­ing af­ter their quar­terly re­sults and fore­casts failed to ex­cite in­vestors.

Har­ley-David­son slumped 9.6 per­cent af­ter the mo­tor­cy­cle maker cut its 2017 ship­ments fore­cast.

The health­care sec­tor will be un­der scru­tiny af­ter the Repub­li­can health­care bill to re­place Oba­macare sank in the Se­nate, with news that two Repub­li­can sen­a­tors would not sup­port the lat­est ver­sion of the bill.

The health­care bill fail­ure spelled un­cer­tainty for Pres­i­dent Donald Trump's agenda of tax re­form and an in­fra­struc­ture over­haul, leav­ing the pres­i­dent without any ma­jor leg­isla­tive ac­com­plish­ments six months into his ten­ure.

News on the health­care bill sent the US dol­lar to a 10-month low against a bas­ket of ma­jor cur­ren­cies. "In­vestor sen­ti­ment is pes­simistic this morn­ing," said Naeem As­lam, chief mar­ket an­a­lyst at ThinkMar­kets UK. "The fi­asco of the health­care bill means that the tax re­forms or the so called in­fra­struc­ture spend­ing plan are in jeop­ardy."

Unit­edHealth Group fell 0.2 per­cent, while John­son and John­son fell 0.4 per­cent.

The Dow Jones In­dus­trial Av­er­age was down 61.69 points, or 0.29 per­cent, at 21,568.03, the S&P 500 was down 5.71 points, or 0.23 per­cent, at 2,453.43. The Nas­daq Com­pos­ite was down 16.48 points, or 0.26 per­cent, at 6,297.95.

Eight of the 11 ma­jor S&P 500 sec­tors were lower, with the health­care in­dex's 0.50 per­cent fall lead­ing the de­clin­ers. As the earn­ings sea­son gets un­der way, the mar­ket will be keep­ing a close eye on cor­po­rate re­sults to see if the high val­u­a­tions are jus­ti­fied in the face of mixed eco­nomic data, tepid in­fla­tion and pol­icy grid­lock in Wash­ing­ton.

An­a­lysts' are es­ti­mat­ing an 8.2 per­cent rise in sec­ond-quar­ter earn­ings for the S&P 500 com­pa­nies from a year ear­lier. This fol­lows a ro­bust first quar­ter when US com­pa­nies posted their best earn­ings since 2011.

IBM, United Con­ti­nen­tal Hold­ings, CSX and Navient are among the com­pa­nies sched­uled to re­port re­sults af­ter the bell. Net­flix jumped 8.8 per­cent af­ter the stream­ing-tele­vi­sion pi­o­neer's added more sub­scribers than ex­pected in the sec­ond quar­ter.

Emerg­ing stocks flirted with 27-month highs yes­ter­day while cur­ren­cies firmed a touch as the dol­lar traded at 10-month lows af­ter the col­lapse of a key US health­care bill raised doubts about Pres­i­dent Donald Trump's re­form agenda. MSCI's bench­mark emerg­ing stocks in­dex held at lev­els not seen since end-April 2015, still un­der­pinned by Mon­day's solid Chi­nese eco­nomic growth data, which beat con­sen­sus fore­casts and showed firmer ex­ports and pro­duc­tion.

Chi­nese main­land shares rose 0.3 per­cent af­ter fall­ing 1.4 per­cent on Mon­day due to a sharp sell­off in small caps, and Hong Kong gained 0.2 per­cent.

Rus­sian dol­lar-de­nom­i­nated stocks also rose 0.4 per­cent, helped by higher oil prices. But gains were off­set by losses in other mar­kets. Turk­ish stocks fell 0.5 per­cent and In­dian shares slipped 0.6 per­cent from the record highs hit in the pre­vi­ous ses­sion. Higher taxes on cig­a­rette mak­ers clob­bered in­dex heavy­weight ITC.

Both the South African rand and Turk­ish lira held near two-week highs. On Mon­day Turkey ex­tended emer­gency rule for an­other three months, al­most a year af­ter it was im­posed in the wake of last July's failed mil­i­tary coup. The Hun­gar­ian forint was steady against the euro ahead of a cen­tral bank meet­ing at which it is ex­pected to keep rates on hold at record lows of 0.9 per­cent.

The In­ter­na­tional Bank of Azer­bai­jan, the coun­try's big­gest state-run bank, will an­nounce full vot­ing re­sults from cred­i­tors on its pro­posed $3.3 bil­lion debt re­struc­tur­ing af­ter a claimants' meet­ing later in the day.

Mean­while Pres­i­dent Trump has threat­ened "strong and swift eco­nomic ac­tions" if Venezuela goes ahead with plans to cre­ate a Con­stituent As­sem­bly with pow­ers to re­write the con­sti­tu­tion and an­nul the op­po­si­tion-led leg­is­la­ture. —

NEW YORK: Trader An­drew Silverman (right) works on the floor of the New York Stock Ex­change yes­ter­day. Stocks opened slightly lower on Wall Street, led by de­clines in phone and tech­nol­ogy com­pa­nies. — AP

Newspapers in English

Newspapers from Kuwait

© PressReader. All rights reserved.