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Global Market Wrap-Up - September 26, 2013

Thursday, September 26, 2013
Mark Hanna
U.S. stocks bounced after a 5 day selloff with the S&P 500 up 0.35% and the NASDAQ 0.70%. It continues to be a volatile market intraday as the now familiar yearly budget gridlock in D.C. looms. Ten year Treasuries fell, pushing yields up to 2.66% In economic news:
  • Weekly jobless claims fell 5,000 last week to a seasonally adjusted 305,000, according to the Labor Department. The four week average of new claims fell 7,000 to 308,000, the lowest level since June 2007.
  • U.S. home buyers signed fewer contracts to purchase existing homes in August, as higher mortgage rates and higher home prices weighed on housing affordability. Pending home sales fell 1.6% month-to-month, according to the National Association of Realtors. The Realtors warned earlier this month that the increase in closed home sales in August (signed contracts in June or July) was the, "last hurrah," as agents were reporting a steep drop in buyer traffic last month. These pending contracts generally take one to two months to close and therefore indicate slower final sales for the fall.
  • The Commerce Department said on Thursday gross domestic product (GDP) expanded at a 2.5 percent annual rate in the April-June period, unchanged from the second revision.
In stock specific news:
  • For the third quarter, year-over-year S&P 500 earnings are expected to have risen 4.8%, down sharply from a July 1 forecast for earnings growth of 8.5%, according to Thomson Reuters data.
Oil gained 0.4% to $103.03, gold fell 0.9% to $1324.10, while silver dropped .55% to $21.77.

British stocks gained 0.2%, German stocks were fractionally lower, while French stocks fell 0.2%.

In the U.K. the final reading for second quarter growth came in unchanged at 0.7%, but the current account deficit came in worse than expected.

Japan gained 1.2%, while China fell 1.9%.
  • The Japanese Nikkei hit a two month high after reports from Kyodo News that the Japanese government was "urgently" considering a reduction in corporate tax rates, which could offset any negative impact from the consumption tax hike scheduled for October 1.
  • China's Beige Book, a survey of 2000 companies. showed business conditions are worse than recent positive economic data suggests.

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