US stock futures endured sharp losses on Thursday, tugged down by manifesting economic concerns about key European nations.
Thursday, July 10, 2014
Italy, host of the third-largest economy in the euro zone, demonstrated underwhelming data about development and growth while questions persisted about the top bank in Portugal. European shares dipped amid questions about regional growth.
But the Fed is unlikely to boost interest rates any time soon, according to the minutes from two days of meetings last month, which were released on Wednesday. Borrowing costs are at an all-time low of 0.25 percent. This bodes poorly for what most considered to be a recovering EU economy.
Interest rate policy remains in flux
The Wall Street Journal reports the minutes from the June 17 and 18 meetings of the Federal Open Market Committee state the body is poised to leave interest rates as they are. Those record-low levels are largely why the stock indices have repeatedly pushed to all-time high levels this year.
The minutes also referenced the Fed's intention to close the economy-spurring stimulus program after October's policy meeting. The Fed implemented monthly asset purchases in the aftermath of the financial crisis as a method of applying salve to the rough times.
But, despite the agreement about eliminating stimulus measures, policy makers have more work to do about a clear decision regarding interest rates.
Israeli ground invasion remains option
Fighting between Israel and Palestinian militants continued on Thursday, according to CNN. The Israel Defense forces unleashed bombs against Gaza strip, which is under the jurisdiction of militant group Hamas.
The effort is likely to continue and its scope is poised to expand, Israel Prime Minister Benjamin Netanyahu said, noting the nation is seeking an end to Hamas' discharge of rockets at Israel. One option that the Israeli military has not ruled out is a ground invasion of the Gaza Strip. Netanyahu said all options are open at this time.
US Secretary of State John Kerry said he has spoken with leaders on both sides of the conflict. Yet while at a news conference in the Chinese capital, the US' top diplomat said Israel may defend itself.
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