Home' Trinidad and Tobago Guardian : September 6th 2015 Contents SEPTEMBER 6 • 2015 www.guardian.co.tt SUNDAY BUSINESS GUARDIAN
STOCKS | SBG11
It s an adage that investors hate uncer-
tainty. Unfortunately for them, they
got more of it on Friday. The stock
market has been volatile for weeks on
concern that China s economy is slow-
ing more rapidly than previously
thought. But investors have also had to contend
with uncertainty about the outlook for interest
Investors had been hoping that the govern-
ment s August jobs report would give them
more clarity on interest rates, before a key
Federal Reserve meeting later this month.
However, a mixed report left them guessing
as to whether policymakers will feel confident
enough about the strength of the US economy
to raise interest rates from historic lows.
The report showed that the US unemploy-
ment rate fell to a seven-year low in August,
but also that employers added fewer jobs than
"It s interesting and disappointing that
today s data didn t provide us with that Ah-
ha! clarity that everyone is seeking," said
Michael Arone, Chief Investment Strategist
at State Street Global Advisers.
The Dow Jones industrial average fell 272.38
points, or 1.7 per cent, to 16,102.38. The Stan-
dard & Poor s 500 index gave up 29.91 points,
or 1.5 per cent, to 1,921.22. The Nasdaq com-
posite slipped 49.58 points, or 1.1 per cent, to
Fed policymakers have kept their benchmark
interest rate close to zero since late 2008 to
help revive the economy after the Great Reces-
sion. Those low rates have also been good for
the stock market, supporting a bull run that
has lasted for more than six years.
On Friday, the S&P 500 ended the week
down 3.4 per cent, its second-worst weekly
drop of the year. The index is down nearly 10
per cent from its peak of 2,130.82 reached
Much of the damage this week was done
on Tuesday, after gloomy manufacturing data
out of China rekindled fears about the health
of the world s second-largest economy.
But despite the big drop in stocks, some
strategists say that much of the evidence sug-
gests the US economy is maintaining its recov-
ery. A report this week showed robust growth
in the service industry.
"As China is sneezing, there is very little to
suggest that the US is catching a cold," said
Jeremy Zirin, chief US equity strategist for
Wealth Management Research at UBS.
Trading volume was lighter than usual ahead
of the Labor Day holiday. US markets will be
closed on Monday in observance of the holiday.
However, the Chinese stock market, which
has been closed for a two-day holiday, will
Among individual stocks, Netflix continued
its slide on Friday. The company s stock has
slumped for six straight days and closed the
week down 16 per cent on speculation that
competition from rivals including Amazon
and Hulu is intensifying. Variety also reported
Monday that Apple is exploring a move into
Bond prices edged up after the jobs report,
pushing the yield on the benchmark 10-year
Treasury note down to 2.13 per cent from 2.16
per cent on Thursday.
In Europe, the FTSE 100 index of leading
British shares was down 2.4 per cent, Ger-
many s DAX fell 2.7 per cent. The CAC-40
in France was 2.8 per cent lower.
The euro edged up to US$1.1151. The dollar
fell one per cent against the Japanese currency,
to 118.99 yen.
In metals trading, the price of gold fell
US$3.10 to settle at US$1,121.50 an ounce,
silver fell 16 cents to US$14.54 an ounce and
copper declined seven cents to US$2.32 a
The price of oil fell along with stocks but
pared its losses after a closely watched count
of active drilling rigs in the US fell. Crude
declined 70 cents to close at US$46.05 a barrel
in New York. Brent Crude, a benchmark for
international oils used by many US refineries,
fell US$1.07 to close at US$49.61 a barrel in
In other futures trading
on the NYMEX:
--- Wholesale gasoline fell 1.9 cents to close
at US$1.418 a gallon.
--- Heating oil fell 2.3 cent to close at
US$1.596 a gallon.
--- Natural gas fell 7 cents to close at
US$2.655 per 1,000 cubic feet.
Asian stock markets were mostly
lower Friday as caution prevailed
before the release of the monthly
US jobs report and the resumption
of trading on Chinese stock markets
KEEPING SCORE: Japan s Nikkei 225 fell 1.1
per cent to 17,976.77 and South Korea s Kospi
dropped 0.9 per cent to 1,899.20. Hong Kong s
Hang Seng shed 0.2 per cent to 20,886.89 and
Australia s S&P/ASX 200 fell 0.4 per cent to
5,007.00. Stock markets in Southeast Asia also
EUROPE WATCH: European Central Bank
President Mario Draghi said Thursday the bank is
ready to give the eurozone a bigger dose of stimulus
should inflation across the 19-country bloc fail to
pick up. Along with keeping interest rates low, the
ECB is pumping 60 billion euros a month into the
region s economy through purchases of government
and corporate bonds. The program is slated to run
at least through September 2016. Draghi also warned
that slowing growth in emerging economies, espe-
cially China, is dragging on Europe s growth
CHINA WATCH: Chinese stock markets
remained closed for a second day as the country
marked the 70th anniversary of Japan s defeat in
World War II. After a summer of wild volatility in
the Shanghai stock market and the surprise yuan
devaluation, investors may be using the Chinese
holidays to reduce exposure to stocks because they
are uncertain about how China will perform on
Monday, said Bernard Aw, a market strategist at
IG in Singapore.
CURRENCIES: The dollar fell to 119.55 yen
from 120.12 yen in the previous trading session.
The euro rose to US$1.1128 from US$1.1124. AP
A currency trader rubs his eyes at the foreign exchange dealing room of the KEB
Hana Bank headquarters in Seoul, South Korea, Friday, September 4, 2015. Asian
stock markets were mostly lower Friday as caution prevailed before the release of
the monthly US jobs report and the resumption of trading on Chinese stock markets
next week. AP
Traders work in a booth on the floor of the New York Stock Exchange, Monday, August 24,
2015. US investors woke up to a serious jolt Monday when the Dow Jones industrial average
tumbled 1,000 points minutes after the market opened in a wave of selling that circled the
globe after a historic plunge in Chinese stocks. AP
US stocks drop,
How the Dow Jones industrial
average fared on Friday
For the day:
The Dow fell 272.38 points, or 1.7 per
cent, to 16,102.38.
The Standard & Poor s 500 index
declined 29.91 points, or 1.5 per cent,
The Nasdaq composite dropped 49.58
points, or 1.1 per cent, to 4,683.92.
For the week:
The Dow is down 540.63 points, or
3.3 per cent.
The S&P 500 has lost 67.65 points,
or 3.4 per cent.
The Nasdaq is down 144.41 points,
or 3 per cent.
For the year:
The Dow is down 1,720.69 points, or
9.7 per cent.
The S&P 500 index is down 137.68
points, or 6.7 per cent.
The Nasdaq is down 52.14 points, or
1.1 per cent.
Asian stock markets ebb ahead of US jobs report
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