LAST CHANGE % CHG
DJIA 17731.95 -119.09 -0.67%
Nasdaq 5146.41 -25.36 -0.49%
S&P 500 2102.15 -12 -0.57%
Japan: Nikkei 225 20683.95 90.28 0.44%
Hang Seng 25398.85 116.23 0.46%
Shanghai Composite 4123.92 97.88 2.43%
S&P BSE Sensex 28370.84 -134.09 -0.47%
Australia: S&P/ASX 5590.3 -24.3 -0.43%
UK: FTSE 100 6655.01 -12.33 -0.18%
PRICE CHG YIELD
U.S. 2 Year 2/32 0.706
U.S. 5 Year 5/32 1.635
U.S. 10 Year 14/32 2.272
Australia 10 Year 11/32 2.863
China 10 Year -19/32 3.53
India 10 Year 2/32 8.014
Japan 10 Year 0/32 0.416
German 10 Year 0/32 0.703
LAST(MID) CHANGE
Australia $ (AUD/USD) 0.7355 -0.0022
Yen (USD/JPY) 123.88 -0.09
S. Korean Won (USD/KRW) 1162.09 5.05
Chinese Yuan (USD/CNY) 6.2098 0.0018
Euro (EUR/USD) 1.0987 0.0057
WSJ Dollar Index 88.32 -0.02
LAST CHANGE % CHG
Crude Oil 48.87 -0.33 -0.67%
Brent Crude 55.49 -0.64 -1.14%
Gold 1089.6 -1.9 -0.17%
MARKETS AT A GLANCE (Data as of approximately 5 p.m. ET)
SNAPSHOT:
The Dow industrials slumped Thursday following disappointing earnings reports from a handful of big U.S. companies. Treasurys rose for a third straight session as demand rose for safer assets. U.S. oil prices sank into a bear market as a global glut of crude shows little sign of abating. Gold prices carved out a slight gain, interrupting 10 consecutive days of declines, as a weaker dollar and lower prices lured buyers back into the market.
OPENING CALL:
Some Japanese investors have used the recent market rout in China as a buying opportunity, reasoning that growth opportunities there make battered Chinese equities worth acquiring. Japan's Dai-ichi Life Insurance bought Chinese stocks after markets peaked in mid-June by using cash made from trimming some holdings as shares surged earlier in the year, said Koya Iwabuchi, the company's general manager of equity investment. "The growth rate has slowed down, but [the economy] is still expanding at 6% or so. Corporate value growth will also likely be attractive," he said. Mr. Iwabuchi said foreign investors in mainland-listed stocks generally understand "risks unique to China, albeit to a varying degree."
EQUITIES:
The Dow industrials slumped following disappointing earnings reports from a handful of big U.S. companies.
Weak results from heavy-equipment manufacturer and economic bellwether Caterpillar weighed down the blue-chip index. Downbeat reports from American Express and manufacturer 3M also dented the benchmark.
The Dow Jones Industrial Average lost 119.12 points, or 0.7%, to 17731.92.
Shares of Caterpillar posted some of the biggest losses in the 30-company Dow, sinking 3.6% and contributing 19 points to the index's slide. The poor results knocked the broader industrials sector lower. The company posted a steeper-than-expected 13% drop in quarterly sales.
American Express shares lost 2.5%, adding 13 points to the Dow's loss, after the credit-card company's second-quarter earnings fell 3.7%.
3M lost 3.8%, knocking 39 points off the index, after the firm cuts its 2015 earnings guidance even as profits rose.
"We had some earnings surprise on the negative side," said Angel Mata, head of institutional equity trading at Stifel Nicolaus. "Caterpillar started this market going down."
The S&P 500 lost 12 points, or 0.6%, to 2102.15. The Nasdaq Composite shed early gains to decline 25.36 points, or 0.5%, to 5146.41.
Chinese shares notched their sixth straight session of gains Thursday as Beijing-backed funds and buying by large shareholders appeared to support the market's rebound, according to analysts.
FOREX:
The dollar fell against the euro and the yen as investors booked profits on the U.S. currency's recent gains one week before the Federal Reserve's policy-setting committee meets to discuss interest rates and the economy.
The dollar declined 0.6% versus the common currency, with one euro buying $1.0991 in late-afternoon trade. The greenback slipped 0.1% against the yen to Yen123.80.
The Wall Street Journal Dollar Index, which measures the greenback against a group of 16 widely traded currencies, slid 0.1% to 88.28. The index had gained 5.4% from May 15 to Monday but has fallen 0.5% since.
The dollar dipped as investors took profits ahead of longer-term expectations for a stronger greenback. Many analysts and money managers predict the U.S. economy will regain its footing, which will persuade the Fed to raise interest rates for the first time in nine years.
The central bank could shed new light on its intentions for U.S. rates when it concludes its two-day policy meeting on Wednesday next week.
The Fed has signaled that it could raise interest rates as early as September, but investors have been forecasting that the central bank most likely will move at its December meeting. Higher U.S. rates will make the dollar more attractive to yield-hungry investors.
Investors will parse the meeting's statement for any indications by committee members that the central bank is preparing to increase rates sooner than consensus expects, said Vassili Serebriakov, currency strategist at BNP Paribas.
"The Fed may acknowledge that some parts of the economy are doing better, " Mr. Serebriakov said. "I don't think the market expects this meeting to set up a September hike."
BONDS:
U.S. government bonds extended price gains into a third consecutive day as weaker stocks and crude oil prices boosted demand for safer assets.
The yield on the benchmark 10-year Treasury note fell to 2.278% in late-afternoon trading, compared with 2.322% Wednesday. It marks the yield's lowest closing level since July 8. Yields fall as prices rise.
Treasury bond yields had risen earlier in the session as an upbeat labor market report brightened the U.S. economic outlook. The latest weekly jobless claims fell to the lowest level since 1973, which bolsters the case for the Federal Reserve to start raising benchmark short-term interest rates as soon as September. A shift in the Fed's loose monetary policy would shrink the value of outstanding bonds.
The report sent the yield on the two-year Treasury note to 0.727%, near the highest level of 2015. Yields on shorter-dated notes are the most sensitive to changes in the Fed's rate outlook. But the yield settled at 0.698% Thursday, compared to 0.706% on Wednesday.
Shorter-dated Treasury notes have been lagging as investors cashed out of these maturities and moved cash into longer-dated bonds to prepare for the Fed's tightening plan.
Investors have been demanding a lower premium to hold the benchmark 10-year Treasury note instead of the two-year note. The shrinking premium is known as a flattening yield curve. On Thursday, the premium was 1.58 percentage point, the lowest level in nearly two months.
"The bond market is adjusting," said Donald Ellenberger, head of multisector strategies at Federated Investors Inc., which had $355.8 billion in assets under management as of March 31. "But no one is certain whether the Fed is able to tighten in September or not."
COMMODITIES:
U.S. oil prices sank into a bear market as a global glut of crude shows little sign of abating.
Prices had settled below the key $50-a-barrel mark for the first time since early April on Wednesday, and they kept falling for most of Thursday. An unexpected increase in U.S. crude inventories, announced earlier this week, combined with high production already coming from the Organization of the Petroleum Exporting Countries, is raising concerns that the market is settling into a long period of oversupply.
Light, sweet crude for September delivery settled down 74 cents, or 1.5%, at $48.45 a barrel on the New York Mercantile Exchange, the lowest settlement since March 31. The U.S. benchmark has posted losses in 17 of the past 21 sessions. That skid has now dropped it into a bear market, down more than 21% from the 2015 high that it hit just a month ago.
Brent, the global benchmark, fell 86 cents, or 1.5%, to $55.27 a barrel on ICE Futures Europe. That is Brent's lowest settlement since April 2.
"We expect the market to remain heavily oversupplied for the next year, keeping prices subdued," said Thomas Pugh, commodities analyst at Capital Economics.
Gold prices carved out a slight gain, interrupting 10 consecutive days of declines, as a weaker dollar and lower prices lured buyers back into the market.
TODAY'S HEADLINES:
Amazon Posts Surprising Profit
Amazon surprised investors by reporting an unexpected profit along with better-than-expected sales gains. Shares jumped 17% to $565 in after-hours trading.
AT&T Profit Tops Views, but Mainstream Subscriber Growth Slows
AT&T reported a sharp decline in mainstream subscriber growth in its second quarter over the prior year, though the telecom giant logged better-than-expected adjusted earnings growth.
Starbucks Revenue and Profit Grow
Starbucks said revenue jumped 18% in the June quarter, boosting profit as traffic increased world-wide, and it raised its full-year earnings outlook.
Big Vehicles Power Surge in GM Profit
GM kept on trucking in the second quarter despite slower growth in China, as the popularity of its pickups and SUVs led the company to solidly beat analyst expectations.
Pearson Inks Deal to Sell Financial Times to Nikkei
Pearson said it would sell FT Group, which includes the Financial Times newspaper, to Nikkei of Japan for more than $1.3 billion.
Turkey to Allow U.S. Strikes Against ISIS From Its Soil
(MORE TO FOLLOW) Dow Jones Newswires
July 23, 2015 17:30 ET (21:30 GMT)
Turkey has agreed to let the U.S. military carry out airstrikes against Islamic State fighters from a U.S. air base near the Syrian border, defense officials said.
Visa's Earnings Top Expectations
Visa's earnings for its fiscal third quarter topped Wall Street expectations as the company posted growth in payment volume.
SEC Investigating Smirnoff Maker Diageo
The SEC is investigating whether Diageo has been shipping excess inventory to distributors in an effort to boost the liquor company's results.
IMF Seeks More Overhauls as China Pursues Reserve Status for Yuan
The International Monetary Fund said it wants more financial-system overhauls from China as Beijing pushes for the IMF to label the yuan a reserve currency.
McDonald's Reports Weak U.S. Sales
McDonald's reported first-quarter results that CEO Steve Easterbrook labeled "disappointing," as U.S sales fell more than expected despite new promotions and other turnaround initiatives in its critical home market.
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TODAY'S CALENDAR
(Times in GMT, followed by country and event)
2100 SKA Jul Consumer Sentiment Index
2245 NZ Jun Overseas Merchandise Trade
0100 PHI May External Trade Performance
0135 JPN Jul Japan Flash Manufacturing PMI
0145 CHN Jul China Flash Manufacturing PMI
0200 SRI Jul Central Bank of Sri Lanka Monetary Policy Review announcement
0401 MAL May Labour Force Statistics
0500 SIN Jun Industrial Production Index
0700 FRA Jul France Flash PMI
0730 THA Weekly International Reserves
0730 GER Jul Germany Flash PMI
0800 EU Jul Eurozone Flash PMI
0820 TAI Jun Money Supply
1130 IND Weekly foreign exchange reserves
1345 US Jul US Flash Manufacturing PMI
1400 US Jun New Residential Sales
1800 CAN Bank of Canada Weekly Financial Statistics
(END) Dow Jones Newswires
July 23, 2015 17:30 ET (21:30 GMT)
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