Downbeat economic data from China and ongoing tension in the Ukraine sent the stock market sinking on Thursday.
The latest disappointing economic reports from China combined with ongoing anxiety about Russia’s adventure in the Ukraine to send stocks sinking on Thursday. There were red numbers everywhere except for the utilities sector, which usually becomes a “safe haven” during periods of stock market weakness.
The Dow Jones Industrial Average (DIA) lost 231 points to finish Thursday’s trading session at 16,108 for a 1.41 percent decline. The S&P 500 (SPY) fell 1.17 percent to 1,846.
The Nasdaq 100 (QQQ) sank 1.50 percent to finish at 3,651. The Russell 2000 (IWM) dropped 1.23 percent to 1,176. What Buffett Is Buying
In other major markets, oil (USO) dipped 0.03 percent to close at $35.34.
On London’s ICE Futures Europe Exchange, May futures for Brent crude oil declined 49 cents (0.46 percent) to $106.86/bbl. (BNO).
April gold futures declined 20 cents (0.02 percent) to $1,370.30 per ounce (GLD).
The transportation sector went off the side of the road and into a ditch during Thursday’s trading session, as the Dow Jones Transportation Average fell 1.39 percent to 7,480 (IYT).
In Japan, the exchange rate for the yen remained the dominant factor in stock market activity. Japanese stocks took a slight dip as the yen strengthened to 102.65 per dollar during the last 10 minutes of Thursday’s trading session in Tokyo. A stronger yen causes Japanese exports to be less competitively priced in foreign markets (FXY). The Nikkei 225 Stock Average retreated 0.10 percent to 14,815 (EWJ).
As has been the case recently, dismal economic news was of little concern to investors in mainland China. Stock prices surged as attention was focused on reports that the China Securities Regulatory Commission will launch a pilot program allowing listed companies to issue preferred shares. Never mind that the National Bureau of Statistics reported that February’s industrial production rose 8.6 percent on a year-over-year basis, compared with January’s 9.7 percent annual rate and economists’ estimates of a 9.5 percent increase. The Shanghai Composite Index climbed 1.07 percent to 2,019 (FXI). Nevertheless, the gamblers in Hong Kong were more mindful of the risks ahead. Hong Kong’s Hang Seng Index declined 0.67 percent to 21,756 (EWH).
European investors remained in a risk-averse mood ahead of this weekend’s rigged referendum on Russia’s annexation of Crimea. The Euro STOXX 50 Index finished Thursday’s session with a 1.50 percent drop to 3,019 – falling further below its 50-day moving average of 3,090. Its Relative Strength Index is 37.52 (FEZ).
Technical indicators revealed that the S&P 500 remained above its 50-day moving average of 1,828 on Thursday, despite sinking 1.17 percent to 1,846. Its Relative Strength Index (RSI) dropped to 50.32. The MACD just crossed below the signal line, suggesting that the S&P could continue its decline during the immediate future.
On Thursday, all sectors finished the session solidly in the red, except for the utilities sector. The industrial sector took the hardest hit, falling 1.42 percent.
Consumer Discretionary (XLY): -1.21%
Technology: (XLK): -1.35%
Industrials (XLI): -1.42%
Materials: (XLB): -0.72%
Energy (XLE): -1.00%
Financials: (XLF): -1.13%
Utilities (XLU): +1.04%
Health Care: (XLV): -1.36%
Consumer Staples (XLP): -0.49%
Bottom line: Although investors in mainland China remained in a state of denial about the severity of that nation’s economic slowdown, the situation combined with the Russia’s adventure in the Ukraine to send stocks lower in the United States and Europe.
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