Over 40 years’ heritage
185,800 clients worldwide
Over 15,000 markets

Losses worsen on Wall Street

Stocks have fallen deeper into negative territory, dragged down by commodity shares as the market continues to be plagued by worries about the health of the Chinese economy.

It’s a similar story for the afternoon trading session in New York today as it was yesterday, namely that a combination of negative issues are nibbling away at investor confidence. The two main culprits are China and Russia, although both are very different situations of course.

News that Chinese company Shanghai Chaori Energy Science & Technology had defaulted on bond payments came and went last week without causing too many ructions to US stocks, depite rattling the copper market. But now after a handful of disappointing economic indicators out of China that point to a slowing economy, the news of the first Chinese company to default on corporate bonds onshore starts to look part of a worrying bigger picture.

Mining company Freeport-McMoRan Copper & Gold dropped 2.5%, while oil and gas producers EOG Resources (-1.9%), Pioneer Natural Resources (-3.2%) and QEP Resources (-1.2%) were other commodity-related losers.

With under 20 minutes to the closing bell, the Dow Jones was down 0.41% at 16,350 and the S&P 500 had slid 0.60% to 1866.0.

Sentiment has shown quite a bit of fortitude in the face of geo-political worries emanating from Ukraine and the Chinese growth concerns, but with two days of declines on Wall Street now there is a hint that we could be seeing investor confidence starting to buckle. The US economic calendar is thin again tomorrow and it is Thursday’s retail sales report that could prove to be a key determinant of near-term direction for the market.

The information on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG Bank S.A. accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it and as such is considered to be a marketing communication.

Find articles by analysts