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US stocks on Thursday were on the verge of falling for a second consecutive session, as investors appeared to continue to react negatively to the Federal Reserve's minutes that could have been interpreted as slightly more hawkish by investors.
What is the performance of benchmarks
Futures for the Dow Jones Industrial Average
YMZ8, -0.36%
down by 112 points, or 0.4%, to 25,622, those of the S & P 500
ESZ8, -0.39%
decreased by 13.70 points to 2,802.25, down 0.5%. The Nasdaq-100 futures traded at 46.25 points, or 0.6%, down to 7,267.75.
Wednesday, the Dow
DJIA, -0.36%
ended the day down 91.74 points, or 0.4%, to 2706.88. The S & P 500
SPX, -0.03%
lost 0.71 point, or less than 0.1%, falling to 2,809.21, while the Nasdaq composite index
COMP -0.04%
lost 2.79 points to close at 7.642.70.
According to FactSet data, the three major benchmarks have not posted consecutive losses since October 11th.
What is the engine of the markets?
Chinese stock markets hit their lowest level in four years and a seemingly fierce Fed combined on Thursday to undermine investor sentiment.
The minutes of the Fed's September meeting, released on Wednesday, said policymakers were moving ahead with increases and could raise rates as early as December, as expected. The tightening of the policy is not a surprise, but it raises concerns about rising borrowing costs and its potential impact on stock prices, market participants said.
Last week's drop in equities was partly attributed to higher US government bond yields, which may also reduce equity appetite compared to the so-called safe treasures. Rate increases should further increase yields.
Concerns about the vitality of the Asian markets, especially China, could also weigh on the investor mood. Shanghai Composite Index
SHCOMP, -2.94%
fell 2.9% and the Shenzhen A-Share
399,106, -2.73%
fell 2.7%. The weak markets in Beijing came after the Chinese currency, the yuan, briefly touched its lowest level since January 2017. A dollar reached 6.9379 yuan
USDCNY, + 0.171%
up 0.2%. These monetary movements came after the US Treasury refused to designate China as a monetary manipulator in its semi-annual report on monetary practices released Wednesday night.
The United States and China are trapped in a niche market that shows no signs of easing and is likely to produce intermittent headwinds for the markets.
What stocks are under discussion?
Alcoa Corp. stock
AA + 1.41%
pre-market profits were better than expected and the company announced an aluminum deficit for this year.
Endocyte Inc. shares
ECYT, -2.45%
skyrocketed after Novartis AG
NVS, -0.51%
NOVN, + 2.02%
said he would buy the cancer drug maker for $ 2.1 billion.
Winnings for Thursday include Danaher Corp.
DHR, -0.09%
Philip Morris International
PM, + 1.27%
and Travelers Cos. Inc..
TRV, + 1.35%
with American Express Co.
AXP, + 0.07%
and PayPal Holdings inc.
PYPL, -0.65%
were due after closing.
What data are developed?
Weekly jobless claims and the Philly Fed manufacturing index for October are expected at 8:30 am, Eastern time, while a report on advanced economic indicators is expected to be released at 10 am .
What do the strategists say?
"US Treasury yields have risen after news of the FOMC with 10-year yields rising above 3.2% earlier today." increase relative to their current levels, investors will be even more reluctant to buy the troughs of their shares, "wrote Hussein Sayed, chief market strategist at the FXTM in a research note Thursday.
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