Morning MoneyBeat Asia: U.S. Stocks Fall After Yellen Comments

        By Paul Vigna
        Market Snap: At the New York close: S&P 500 down 0.45% at 2080.15. DJIA down 0.5% at 17841.98. Nasdaq Comp down 0.4% at 4914.64. Treasury yields rose; 10-year at 2.236%. Nymex crude oil up 0.9% at $60.93. Gold down 0.2% at $1,190.30/ounce.
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        How We Got Here: A second day of broad selling for U.S. stocks left the Dow Jones Industrial Average up a scant 19 points on the year. The slide came after Fed Chairwoman Janet Yellen said the markets look overbought and ADP came out with a weak April jobs report.
        This is the way it's been for stocks this year. On Monday, we were talking about the S&P 500 being a few points away from a fresh record. Before that, the Nasdaq Composite did set a fresh record, its first in 15 years. Now we're looking at the Dow falling in the red for the year.
        On Wednesday, Ms. Yellen briefly mentioned the markets in a speech in Washington with IMF Director Christine Lagarde. Ms. Yellen said market valuation appear "quite high." When the head of the world's preeminent central bank says that, you don't spend time trying to read tea leaves. The market turned down and stayed down.
        Also, ADP said the U.S. economy created only 169,000 jobs in April. That was below expectations, and doused some enthusiasm for Friday's April jobs report. After the surprisingly weak March number (126,000, if you recall), bulls are counting on a rebound. If they don't get it, Ms. Yellen's words are going to start really stinging.
        Coming Up: Investors in Australia will get the latest reading on the nation's economy with the release of the April labor-market report. The economy added 37,700 new jobs in March, outpacing economists' expectations of a rise of 15,000 and lowering the unemployment rate to 6.1%, the lowest since December. On Tuesday, Australia's central bank cut interest rates to a fresh record low of 2.0%, hoping to give a jolt to an economy that's suffering from the end of a decadelong mining boom.
        What You Missed Overnight
        Yellen Says Market Valuations 'Quite High' Federal Reserve Chairwoman Janet Yellen said Wednesday stock market valuations appear "quite high" and some bond and loan markets suggest investors may be taking excess risks, though she said risks to financial stability generally are contained.
        U.S. Stocks End Lower U.S. stocks fell on Wednesday after Federal Reserve Chairwoman Janet Yellen drew attention to elevated valuations in the equity market.
        Private Sector Jobs Rose Only 169,000 in April, ADP Says Private-sector payrolls once again expanded at a mediocre pace last month, according to an employment survey released Wednesday. Private payrolls in the U.S. increased by just 169,000 jobs in April, said the national employment report compiled by payroll processor ADP and forecasting firm Moody's Analytics.
        Germanwings Co-Pilot Rehearsed Crash The co-pilot who flew a Germanwings jetliner into a French mountainside appeared to have rehearsed the deadly descent on the plane's previous flight that morning, French investigators said.
        In U.K. Election, It's Jobs Boom vs. Stagnant Wages As the U.K. goes to the polls this week, the state of its economy has become both a central issue in the campaign, and a puzzle.
        From The Wall Street Journal Asia
        Chinese Drone Maker DJI Raises $75 Million Chinese drone maker SZ DJI Technology Co. secured a $75 million investment this week that values the company at roughly $8 billion, according to people familiar with the situation, propelling the firm into an exclusive club of startups and signaling Silicon Valley's high hopes for the commercial promise of flying robots.
        India Moves Closer Toward Streamlining Taxes India's lower house of parliament passed a bill Wednesday that sets the stage for the country to roll out a new, nationwide goods and services tax.
        Pakistan Separatist Faces Military's Wrath Playing host to Mama Qadeer Baloch is a dangerous act in Pakistan. The 73-year-old human-rights campaigner routinely receives death threats; his hosts at public appearances have been targeted for assassination; and on Wednesday, the administration of Karachi University shut a planned lecture to avoid the wrath of the country's powerful military establishment.
        India's Modi Is Social Media #Superstar When India's premier wanted to signal a thaw in relations with rival Pakistan recently, he didn't call a press conference or make a televised speech. He tweeted.
        From MoneyBeat
        U.K. Election Rehashes Old Arguments One of the more heated arguments in the run-up to Britain's general election on Thursday is the degree to which the then-Labour government's economic stewardship contributed to the financial crisis.
        Bearish Options Bets Pile Up In High-Yield Corporate Bond ETF Investors are making big, bearish options bets on high-yield corporate bonds ahead of an expected increase in interest rates from the Federal Reserve.
        List of Operational Issues for Markets Since the Flash Crash Five years after the Flash Crash, concerns about market stability remain.
        El-Erian Sees Market 'Delusion' Amid 'New World' Opening the annual SALT conference on Wednesday, Allianz chief economic advisor Mohamed El-Erian (and former Pimco heir apparent and Harvard endowment chief) flagged a bumpy ride for the future, particularly when the Federal Reserve raises interest rates.
        (END) Dow Jones Newswires

        May 06, 2015 20:44 ET (00:44 GMT)

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