US stock indices looked set to extend a weeklong slide, as ratcheting tensions between Ukraine and Russia and poor results from some US firms hit investor confidence Wednesday morning.
Wednesday, August 6, 2014
Across the Atlantic, the British FTSE, German DAX and French CAC 40 indices all fell about 1.15% by 9:00 a.m. EST.
Russian President Vladimir Putin has begun pushing for various forms of retaliation to strike back against the Western nations that have levied economic sanctions on Russia, The New York Times reports. "The political tools of economic pressure are unacceptable and run counter to all norms and rules," he told Russian sources, according to the Times. The suggested "retaliatory measures," as Prime Minister Dmitri A. Medvedev dubbed them, include banning the use of Siberian airspace for transcontinental flights from Western nations, boycotts on American consumer goods and bans for major US financial firms doing business in the country.
Weak results compound equity fears
Earnings season delivered no relief yesterday afternoon, as Groupon announced losses of $22.9 million, or 2 cents per share, falling behind analyst estimates. Sprint, one of the runners-up in the US telecom industry behind AT&T and Verizon, formally pulled its bid for T-Mobile, which would have consolidated the third- and fourth-place mobile service providers into a more dominant position.
"Ukraine is the obvious mover," Ben Kumar, an investment manager at Seven Investment Management, told Bloomberg. "Various companies when releasing their earnings in Europe, the chief executives have been coming out and saying Ukraine is hurting sales."
Overall, investors had plenty of bad news to look at across the markets, and nothing much to buoy their spirits. Overall, the Dow Jones Industrial Average now stands just 0.89% below its starting position for 2014, while the S&P 500 remains a little healthier at 3.89% above its January 2 figure.
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