Us Markets Close Downward For January
US stocks ended today’s session sharply lower, with major indexes ending down for both the week and the month of January as investors worried about weak US growth and whether instability in Europe could hurt corporate earnings.
By Paolo Palazzi-Xirinachs
Saturday, January 31, 2015 - 00:00
The Dow Jones fell 247.22 points, or 1.42% to 17,169.63, the S&P 500 lost 26.07 points, or 1.29% to 1,995.18 and the Nasdaq dropped 48.17 points, or 1.03% to 4,635.24.
Q4 Economic Growth Slumps
The major blow today was news that US economic growth slowed sharply in Q4 as weak business spending and a wider trade deficit offset the fastest pace of consumer spending since 2006. The slowdown follows two back-to-back quarters of bullish growth and is likely to be short-lived given the enormous tailwind from lower gasoline prices. Other data today showed consumer sentiment jumped to an 11-year high in January. Gross domestic product expanded at a 2.6% annual pace after the third quarter's 5% rate, the Commerce Department said in its first snapshot of fourth-quarter GDP.
Fed mulls over next steps
Federal Reserve officials are confronting divergent economic forces as they weigh the timing of the first interest-rate increase since 2006. Surprisingly strong job gains argue for tightening sooner, while inflation held down by a plunge in oil prices and a cooling global economy provides grounds for delay.
The central bank boosted its assessment of the economy in a statement this week and downplayed low inflation readings, while repeating a pledge to remain “patient” on raising interest rates. It acknowledged global risks, saying it will take into account readings on “international developments” as it decides how long to keep rates low.
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