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T3's Take 3: China Slowdown Drives More Volatility


Today's financial recap and tomorrow's financial outlook.

Today on T3 Live

T3 Live cordially invites you to our first annual Finance Festival, scheduled for November 6-8 in sunny Miami, Florida.

Since we announced the event on July 8, we've added some very big names to the agenda, including:

-David Kotok, Founder and Chief Investment Officer of Cumberland Advisors
-David Rosenberg, Chief Economist of Gluskin Sheff
-Ivan Zinn, Chief Investment Officer of Atalaya Capital Management

Read about our expanded lineup here.

World Equity Markets

Asian shares traded lower on disappointing Chinese economic data.

The Shanghai Composite lost 2.2% today after economic data showed that manufacturing activity fell to a 6.5 year low, once again leading traders to worry about global economic growth. Mining companies were especially weak from the data.

Hong Kong's Hang Seng fell 2% after one of its major brokerages, Citic Securities, was accused by the government of front-running trades ahead of state-backed stock purchases. Japan's markets were closed for holidays but will re-open tomorrow. The Korean Kopsi fell 1.9%.

European stocks gained on strong GDP and PMI numbers out of France. The French CAC rallied 0.1%. The German DAX finished up 0.4% despite Deustche Bank cutting its target for the index

Bond yields were mixed with the German 10-year bund yield rising 0.7 bps. 

US stocks finished lower today, weighed down by the slump in China and a drop in oil prices The S&P 500 closed down X.X%.

Energy were very weak on the drop in oil, while emerging markets and materials stocks were hot on economic concerns. The technology sector managed to stay in positive territory as index leader Apple (AAPL) squeezed out a 0.8% gain.

Volkswagen CEO Steps Down

This week, Volkswagen plummeted some 20%. Since 2009, the company had been installing software in its "clean diesel" vehicles that activated the vehicle's pollution controls only while being tested for emissions. When not in testing, the vehicle were freely exhausting hazardous compounds. Volkswagen claims about 11 million affected vehicles were sold worldwide. 

The Environmental Protection Agency stated that Volkswagen had clearly violated the Clean Air Act, ordering Volkswagen to fix the affected vehicles. It aso threatened as much as $18 billion in fines.

Today, CEO Martin Winterkorn announced his resignation. Volkswagen has also decided to postpone US sales for its 2015 and 2016 clean diesel vehicles.

Turing to Reduce Drug Prices

Turing Pharmaceuticals grabbed headlines earlier this week after CEO Martin Shkreli was criticized by Democratic candidate Hillary Clinton for acquiring the rights for the drug, Daraprim, and boosting its price to $750 a pill from $13.50. The criticism from Clinton sent shockwaves through the biotech sector, causing the NASDAQ Biotechnology Index to drop sharply on Monday and Tuesday.

In an interview with ABC News, Shkreli stated "we agreed to lower the price of Daraprim to a point that is more affordable." No specific price range has been given. 

Thursday's Financial Outlook

US economic news for tomorrow will include Chicago & Kansas CityFed Nat activity index, initial & continuing jobless claims, durable & capital goods reports, Bloomberg consumer comfort, new home sales, and EIA natural gas storage.

Overseas economic data will feature German Gfk consumer confidence survey, and IFO business climate, and Japan's CPI.

Accenture (ACN), and KB Home (KBH) will release earnings before the open tomorrow. 

Bed Bath & Beyond (BBBY), Cintas (CTAS), Jabil Circuit (JBL), and Nike (NKE) will release their earnings after the close. 
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