Wall Street has a case of the summertime blues as investors grapple with fresh doubts about the pace of US economic growth and profits along with ongoing global security issues.
In the holiday-shortened week following the US Independence Day observance, the Dow Jones Industrial Average fell 0.67 percent to 10,213.22 while the broad-market Standard & Poor's 500 dropped 1.11 percent to 1,112.81.
The NASDAQ composite tumbled 3 percent over the four sessions to end Friday at 1,946.33.
A jump in oil prices back to US$40 a barrel in New York over the past week -- reflecting concerns about security -- sparked jitters on Wall Street as earnings season kicked off with results from Alcoa and Yahoo that disappointed most investors.
"Yahoo gave a non-convincing [profit] guidance outlook; that, and a combination of oil prices going over US$40 again, and the fact that the White House is once again warning about terrorist attacks, obviously put pressure on the market," said market strategist Peter Cardillo at SW Bach.
The market regained some lost ground Friday after an upbeat earnings report and outlook from conglomerate General Electric, but not nearly enough to make up for earlier losses.
The market has failed to deliver the summer rally some had anticipated after the Iraq handover and the Federal Reserve's first move boosting interest rates -- along with a pledge to remain "measured" in any future rate moves.
After these events, said Alfred Goldman at AG Edwards, "investors had good reason to get more bullish, but they did not. We were disappointed and surprised by this reaction."
Goldman said he still predicts the S&P 500 will hit 1,200 by the end of the year but is now concerned about investor sentiment.
"A couple of down days does not change a bull to a bear, but they did get our attention, and future market action will be watched very closely," he said.
"Investors are again in a `glass is half full or half empty' dilemma," he said, adding that while economic data have been mixed, "with a `glass is half empty' attitude, investors decided to worry that too slow of a growth rate would put a big brake on earnings expansion."
Other analysts see the market churning in its narrow range as it has over the past six months until a clear catalyst develops.
"We expect the grind of this year's first half to continue over the next six months," said Joseph Quinlan, chief market strategist at Bank of America, citing the "headwinds" of cooling US economic growth, flagging retail sales and other factors.
The market has been fretting since last month's payroll report showed only tepid job growth and other data have been softer than expected, Quinlan said, "leaving many investors to worry that the economy could be losing its momentum."
Quinlan said the presidential election this year is also contributing to market hesitation.
"With no clear front-runner in November's presidential election, investors are likely to face four months of uncertainty regarding the political climate," he said.
"A tight presidential race could prompt many institutional managers to head for the sidelines, contributing to a lackluster market performance over the near term."
Jay Suskind, director of trading at Ryan Beck, said investors are taking a wait-and-see approach as they sift through the earnings reports of the second quarter.
"They are waiting for not so much what [companies] are going to report but what they're forecasting" for the coming months, Suskind said.
Bonds edged lower, giving back some recent gains. The yield on the 10-year US Treasury bond climbed to 4.466 percent from 4.458 percent a week earlier and that on the 30-year bond rose to 5.216 percent from 5.207 percent. Bond yields and prices move in opposite directions.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day
Thousands of parents in Singapore are furious after a Cordlife Group Ltd (康盛人生集團), a major operator of cord blood banks in Asia, irreparably damaged their children’s samples through improper handling, with some now pursuing legal action. The ongoing case, one of the worst to hit the largely untested industry, has renewed concerns over companies marketing themselves to anxious parents with mostly unproven assurances. This has implications across the region, given Cordlife’s operations in Hong Kong, Macau, Indonesia, the Philippines and India. The parents paid for years to have their infants’ cord blood stored, with the understanding that the stem cells they contained