Stocks Drop in a Mirror Opposite of Yesterday's Trading
Today's financial recap and tomorrow's financial outlook.
Some sectors were notably weak today. Financials, which saw earnings reports from Bank of America (NYSE:BAC) and other major banks this week, were down 2% while Bank of America was down more than 6% at one point during the day, despite so-so earnings. Apple (NASDAQ:AAPL) and Google (NASDAQ:GOOG) were also notable laggards after leading the rally higher yesterday. Apple fell 5.75% on reports that one of its main suppliers, Cirrus Logic (NASDAQ:CRUS), had a decline in its chip orders.
There was no major economic data in the US today besides the Fed's Beige Book. This survey of economic conditions in the 12 Fed districts didn't show any great changes. Overall, moderate retail sales and auto sales demand were the key headlines that led to moderate growth.
In global equities, the German DAX took a sudden 2% plunge at the open of European trading on chatter that the country's sovereign debt rating had been downgraded by a credit rating agency. The French CAC was down an equal amount on corresponding chatter that its sovereign credit rating was downgraded. Comments from a Chinese auditor that local Chinese governments have taken on too much debt through off balance sheet investment vehicles prompted concern that slowing China growth would negatively affect global economies.
Tomorrow's Financial Outlook
Tomorrow's economic data comes in the form of weekly initial jobless claims and the Philadelphia regional manufacturing survey. Weekly jobless claims are expected to be at 350,000, under the 4-week moving average of 358,000. The Philadelphia manufacturing survey is expected to increase modestly to 3.0 from March's 2.0.
Globally the economic calendar is light. The only notable reports are Chinese property prices and UK retail sales. During the past few months, the Chinese government has sought to rein in any property price increases by tightening monetary controls, so these results will be highly scrutinized.
Tomorrow will be the busiest days of the week for US earnings with 21 major companies reporting. Notable reports include Union Pacific (UNP), Pepsi (PEP), Morgan Stanley (MS), Verizon (VZ), Chipotle Mexican Grill (CMG), IBM (IBM), Microsoft (MSFT), and Google.
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