Mar­kets

The Times Herald (Norristown, PA) - - BUSI­NESS -

they see weak­ness in the economy ahead. The yield on the 10-year Trea­sury note fell to 2.89 per­cent from 2.92 per­cent on Tues­day, a large move.

U.S. stock and bond trad­ing were closed Wed­nes­day be­cause of a na­tional day of mourn­ing for Pres­i­dent Ge­orge H.W. Bush.

Losses in banks and en­ergy and in­dus­trial stocks out­weighed gains in in­ter­net and real es­tate com­pa­nies.

Cit­i­group fell 3.5 per­cent to $60.06. Hal­libur­ton slid 4.7 per­cent to $29.79. Dis­cov­ery climbed 4.7 per­cent to $26.99.

Last week, stocks jumped af­ter Fed Chair­man Jerome Pow­ell in­di­cated the cen­tral bank might con­sider a pause in rate hikes next year while it gauges the im­pact of its credit tight­en­ing pro­gram.

The Fed has raised rates three times this year and is ex­pected to boost rates for a fourth time at its Dec. 1819 meet­ing of pol­i­cy­mak­ers. That steady pace of rate hikes has be­gun to worry some in­vestors amid grow­ing signs that some sec­tors of the economy are hurt­ing, in­clud­ing the U.S. hous­ing mar­ket. At the same time, there has been grow­ing ev­i­dence that global eco­nomic growth is slow­ing.

“The mar­ket seems right now to be fo­cused on in­creased risks for a 2020 re­ces­sion,” said Pa­trick Schaf­fer, Global In­vest­ment Spe­cial­ist, J.P. Morgan Pri­vate Bank. “It’s a very hard mar­ket to buy when you see re­ally strong sig­nals that we are in­deed late (in the eco­nomic) cy­cle.”

Thurs­day’s ini­tial wave of sell­ing in the mar­ket came about as traders re­acted to the news that Cana­dian au­thor­i­ties ar­rested the chief fi­nan­cial of­fi­cer of China’s Huawei Tech­nolo­gies on Wed­nes­day for pos­si­ble ex­tra­di­tion to the U.S. The Globe and Mail news­pa­per, cit­ing law en­force­ment sources, said Meng is sus­pected of try­ing to evade U.S. trade curbs on Iran.

Meng is a prom­i­nent mem­ber of Chi­nese society as deputy chair­man of the board and the daugh­ter of com­pany founder Ren Zhengfei. China de­manded Meng’s im­me­di­ate re­lease.

The ar­rest came less than a week af­ter Pres­i­dent Don­ald Trump met with Chi­nese Pres­i­dent Xi Jin­ping at the G-20 sum­mit in Ar­gentina.

Mar­kets ral­lied on Mon­day on news that Trump and Xi agreed to a tem­po­rary, 90-day stand-down in their trade dis­pute. That op­ti­mism quickly faded as skep­ti­cism grew that Bei­jing will yield to U.S. de­mands any­time soon, lead­ing to a steep sell-off in global mar­kets on Tues­day.

On Thurs­day, China’s gov­ern­ment said it would promptly carry out the tar­iff cease-fire with Wash­ing­ton. It also ex­pressed con­fi­dence that the two na­tions can reach a trade agree­ment. The re­marks sug­gest Bei­jing wants to avoid dis­rup­tions from Meng’s ar­rest.

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