US Stocks Rally Dissipates on Post-Brexit IMF Slowdown Report and Poor Q2 Results
The US markets were mostly lower today as a near three-week rally that took indexes to new highs, finally lost momentum. Coupled with Netflix and other companies reporting disappointing results, and the International Monetary Fund (IMF) predicting a slowdown in Britain after its vote to leave the European Union, it seemed timed for enthusiasm to wane and lock in profits.
By Paolo Palazzi-Xirinachs
Tuesday, July 19, 2016
In mid-afternoon trading, the Dow Jones Industrial was down 0.02% and the S&P 500 stock index was down 0.3%. The Nasdaq also dropped 0.47%. The S&P 500 had surged just over 8% since June 27, when stocks hit a low after the British vote to leave the European Union. Fears that the departure would destabilize the global economy have largely dissipated, but questions remain. The International Monetary Fund trimmed its forecast for global economic growth this year to 3.1% from 3.2%, mostly because of anticipated slowdowns in Britain and other advanced economies as a result of the “Brexit” vote.
Home construction strengthened more in June than economists had expected. Activity was particularly high in the Northeast and West, a report from the Commerce Department showed. The June reading on housing starts was the highest since February, though down from a year earlier.
Investors are anticipating events this week that may help them better gauge the health of the world economy and what it might mean for stock markets. The European Central Bank’s policy rate decision is Thursday, and while no extra stimulus is expected, the bank’s views about the economy could create volatility in markets.
This information has been prepared by Nadex, a trading name of North American Derivatives Exchange, Inc., prepared by independent third parties contracted by Nadex or reproduced form third party news agencies. In addition to the disclaimer below, the material on this page does not contain an offer of, or solicitation for, a transaction in any financial instrument. Nadex 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. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication.