Back to top

Stock Market News for September 24, 2013

Read MoreHide Full Article
Benchmarks posted losses for the third trading session in a row as Federal Reserve officials said they could taper the bond purchase program in late 2013. Investors were also concerned over an approaching deadline of a possible Government shutdown on Oct 1. On the international front, business activity in France grew at its fastest pace in September. Meanwhile, China’s factory activity for the month of September grew to its highest point in past six months.  Of the top ten S&P 500 industry groups, utilities stocks gained the most. Financial stocks suffered maximum losses.

For a look at the issues currently facing the markets, make sure to read today’s Ahead of Wall Street article.  

The Dow Jones Industrial Average (DJI) lost 0.3% to close the day at 15,401.38. The S&P 500 decreased 0.5% to finish yesterday’s trading session at 1,701.84. The tech-laden Nasdaq Composite Index slipped 0.3% to end at 3,765.29. The fear-gauge CBOE Volatility Index (VIX) increased 9.1% to settle at 14.31. Consolidated volumes on the New York Stock Exchange, American Stock Exchange and Nasdaq were roughly 5.8 billion shares, below 2013’s average of 6.24 billion shares. Declining stocks outnumbered the advancers. For 56% shares that declined, 41% advanced. 

Benchmarks suffered losses nearly 0.5% after few Federal Reserve policymakers said the scaling back of massive $85 billion bond purchase program could start during the end of 2013. Losses from the past three trading days have erased the 1.2% gains it garnered during last week. President of the New York Federal Reserve, William said options for tapering the bond purchase program are “still very much intact.” Additionally, president of the Dallas Federal Reserve, Richard Fisher, said he has pushed his colleagues to opt for a $10 billion cut on the massive bond purchase program. He further mentioned that not taking any relevant steps to scale back the bond purchase program might raise questions about the Central bank’s credibility.
On the international front, business activity for September grew at its fastest pace since the start of 2012. Business activity improved on the back of better-than-expected service sector performance. The service sector accounts for nearly 70% of the country’s economy. The purchase managers’ index (PMI) came in at 50.2, compared to 48.8 recorded in the month of August. This is also the first such positive sign, since the index has not exceeded 50since February 2012. Among the major constituents of the purchase managers’ index, the service PMI came in at 50.7 from last month’s reading of 48.9. This reading was also above analysts’ estimate of 49.3. However, the biggest drag on the PMI index was the manufacturing PMI, which came in at 49.5, below previous month’s reading of 49.7.

Meanwhile, China’s HSBC PMI came in at 51.2 compared to August’s reading of 50.1. China’s economy faced a slowdown in 12 out of the past 14 quarters. However, since the last two quarters the Chinese economy has been showing signs of stabilization and growth. Chinese exports have moved the economy back to a growth trajectory. New export orders came in at 50.8 compared to 47.2 in the previous month. During the second quarter, investors were sceptical over that fact that the Chinese economy may not achieve a 7.5% growth rate. However, in light of improving economic indicators, achieving this target seems possible.
Utilities stocks gained the most during yesterday’s trading session. The Utilities SPDR (XLU) gained 1.3%. Stocks such as Public Service Enterprise Group Inc. (NYSE:PEG), Exelon Corporation (NYSE:EXC), NRG Energy Inc (NYSE:NRG), FirstEnergy Corp. (NYSE:FE) and American Electric Power Company Inc (NYSE:AEP) gained 1.4%, 1.0%, 1.5%, 2.7% and 1.4%, respectively.
Financials stocks suffered maximum losses during yesterday’s trading session. The Financials SPDR (XLF) lost 1.4%. Stocks such as Bank of America Corp (NYSE:BAC), JPMorgan Chase & Co (NYSE:JPM), Goldman Sachs Group Inc (NYSE:GS), Wells Fargo & Co (NYSE:WFC) and PNC Financial Services Group Inc (NYSE:PNC) lost 2.1%, 2.5%, 2.7%, 1.3% and 1.5%, respectively.

More from Zacks Market News

You May Like