U.S. Stocks Slump on Disappointing Data
September 23 2019 - 10:25AM
Dow Jones News
By Akane Otani and Caitlin Ostroff
U.S. stocks edged lower Monday, weighed down by declines among
shares of industrial and materials companies.
The Dow Jones Industrial Average inched down 35 points, or 0.1%,
to 26894. The S&P 500 declined less than 0.1%, and the Nasdaq
Composite fell 0.1%.
Data early Monday showed Germany's manufacturing and services
sector weakened more than expected in September, adding to
investors' worries about the health of Europe's biggest
economy.
That sent European markets lower, with the Stoxx Europe 600
retreating 0.9% and German government bond yields slipping further
below zero.
Even with Monday's declines, though, U.S. stock indexes remain
less than 1% from records. Investors have attributed strong gains
there to the relative strength of the U.S. economy.
"It looks like we're in a slowdown, but that slowdown won't
become a recession yet," said Sandip Bhagat, chief investment
officer of Whittier Trust, adding he took reassurance from strong
labor market data, a robust service sector and still benign
inflationary pressures.
Changes in analyst ratings drove swings among individual stocks
Monday, with United States Steel losing 1% and AK Steel Holding
falling 0.9% after JPMorgan Chase lowered its rating on the two
stocks, citing weak steel prices.
Roku jumped 2.7%, paring losses after worries about competition
in the streaming-media devices industry sent the stock tumbling the
prior week.
In Europe, airplane and travel companies were one bright spot in
the region, rising after rival British travel group Thomas Cook
Group failed to conclude a rescue deal with investors and
creditors, canceling all bookings and forcing U.K. authorities to
help get thousands of vacationers home.
Shares of travel company TUI rose 7%, while EasyJet gained
3.5%.
Elsewhere, Chinese shares fell after a canceled trip by Chinese
negotiators to farms in Montana raised doubts about progress on
U.S.-China trade talks. President Trump also late last week
rejected suggestions the U.S. would accept a partial trade
agreement with China, saying his administration is "looking for a
complete deal."
"I think this is the case of, well, we had the promise of more
talks but where do we go from here?" said Chris Beauchamp, chief
market analyst at online trading firm IG Group.
The Shanghai Composite Index closed nearly 1% lower, while its
smaller Shenzhen counterpart fell slightly more than 1%.
"The farm visit news was certainly a factor but having said
that, investors' expectations for a quick resolution had been
pretty low in the first place," said Zhang Gang, senior analyst at
Central China Securities, saying the declines were relatively
limited by Chinese standards.
Twists and turns on the trade front aside, the Chinese central
bank's decision to hold a key medium-term interest rate steady last
week has continued to weigh on sentiment, Mr. Zhang said. "There
are few signs that the authorities will significantly loosen
monetary policy in the near term," he added.
Hong Kong's Hang Seng fell 0.8% after another weekend of
protests. Japan's Nikkei Stock Average was closed for a holiday,
and South Korea's Kospi was flat.
Shen Hong and Joseph Wallace contributed to this article.
Write to Akane Otani at akane.otani@wsj.com and Caitlin Ostroff
at caitlin.ostroff@wsj.com
(END) Dow Jones Newswires
September 23, 2019 10:10 ET (14:10 GMT)
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