On Monday, US stock indices closed in negative territory, amid fears about growing geopolitical tensions and general market consolidation sentiment.
Last weekend North Korea launched four missiles into the Sea of Japan, three of which fell in the exclusive economic zone of Japan.
Investors are trying to be cautious in anticipation of the publication of data from the labor market on Friday and the Fed meeting next week, with partial profit taking. The market is still digesting the statement of the Federal Reserve chairman Yellen that the rate increase in March is quite real.
According to surveys made by FedWatch CME Group, the probability of the rate increase in March is now 86%, compared to 30% ten days ago.
The energy sector was the only one to demonstrate growth during yesterday trades, mainly due to stronger oil prices.
The markets reacted weakly to the publication of stronger than expected data on manufacturing orders in the US. The volume of industrial orders in January rose by 1.2% compared to the previous month, with a growth forecast of 1.0%.
Shares of General Motors Co. rose by 0.8% after the automanufacturer announced the sale of loss-making European units Opel and Vauxhall.
Dow Jones Industrial Average closed down by -51.37 points, or -0.24%, at the level of 20,954.34.
S&P 500 index fell by -7.81 points, or -0.33%, finishing the session at 2,375.31
Nasdaq Composite Index dropped -21.58 points, or -0.37%, to the level of 5,849.17.
March, 7th. Asian stock markets are traded in different directions, amid growing geopolitical tensions and positive data from China.
China published data on its foreign exchange reserves, which showed a decrease in capital outflow from the country.
China’s international reserves rose to $ 3.005 trillion, while analysts had expected a small decline to a level of 2.969 trillion.
Australian stock market strengthened after the central bank kept interest rates at the same level, without any hint of possible downgrade in the future.
The Reserve Bank of Australia retained the key interest rate unchanged at 1.5%, as analysts had expected. The accompanying statement was generally positive and highlighted the prospects for sustainable growth of the country’s economy.
The index of activity in the construction industry of Australia from AIG in February rose to 53.1, from 47.7 in January.
Nikkei 225 dropped during the session by -34.99 points, or -0.18%, finishing the session at 19,344.15.
S&P / ASX 200 in Australia increased by 14.88 points, or by 0.26%, closing at 5,761.39.
The Shanghai index rose 8.54 points, or 0.26%, finishing the session at 3,242.41.
Hang Seng in Hong Kong is growing by 77.02 points, or by 0.33%.
Reserve Bank of Australia kept the rate at a record low
The Reserve Bank kept the rate at a record low, 1.50%, and gave a signal that the economic environment is in line with inflation and growth targets.
The head of the central bank, Philip Lowe, noted that over past few months the situation has improved, and the mood in consumer and business circles has grown.
The rise in commodity prices contributed to the growth of Australia’s national income.
Lowe made it clear that he expects interest rates to rise in the US, whereas, in his view, other leading economies will not expand mitigation programs.
The Greek economy did not meet expectations at the end of 2016
The Greek economy showed results that did not meet expectations in the last quarter of last year.
GDP fell by 1.2%, the quarterly high since the summer of 2015.
According to preliminary forecasts, the economy should have lost 0.4%.
These figures came out a few days after the head of the central bank of Greece, Yannis Stournaras, said that international creditors should lower their budget targets for Athens in 2021.
Mitigating the targets for the primary surplus, along with structural reforms, will lay the foundation for a gradual reduction in taxes, as well as favorably affect economic growth.
The second revision of the program of assistance to Greece goes on for several months, because of disagreements between the EU and the IMF on budgetary targets for 2017.
The IMF advocates a more lenient approach to the budget, believing that new austerity measures and spending cuts will not improve Greece’s financial prospects.