US Stocks Suffer Worst Monthly Losses Since March 2020 | Financial Markets News

Investors are wary of the global energy crisis, the US debt ceiling debate and the US Federal Reserve’s plans to cut some of its pandemic-related economic support, among other factors.

TO Bloomberg

Volatility continued to plague financial markets, with US stocks posting their biggest monthly sell-off since March 2020.

Shares fell on Thursday even after confirmation that the House of Representatives passed a nine-week spending bill to prevent the US government from shutting down. For traders, this was just one of many risks. Investors are also gearing up for the Fed to roll back its stimulus amid growing concerns about slowing economic growth, rising inflation, supply chain bottlenecks, the global energy crisis and regulatory risks emanating from China.

Political controversies in Washington threaten to push the US towards default and force President Joe Biden to cut his spending. Democratic Senator Joe Manchin wants to cut the social spending package by more than half to $ 1.5 trillion. House Speaker Nancy Pelosi pushed for a vote on a bipartisan infrastructure bill, even though Progressive Democrats said they have numbers to delay it until the Senate agrees on a broader tax and spending package.

“The old adage that the market is climbing a wall of worry has not been forgotten for us,” said Tom Mantion, managing director of UBS Private Wealth Management. “Concerns about China, the pandemic, debt ceilings and tax laws are weighing on investors right now, but it is important to understand which challenges can cause structural change and which ones can trigger short-term volatility that investors can take advantage of.”

The S&P 500 closed at its lowest level since July, increasing its September losses to nearly 5%. Economically sensitive companies like industrial and financials were among the worst on Thursday. The slide almost canceled out the growth of the index for the quarter.

The near-record technical band for the S&P 500 has left some bulls worried that a sharp pullback is brewing.

“The S&P 500 has traded an incredible 317 straight trading days above its 200-day moving average, one of the longest bands ever,” said Ryan Detrick, chief market strategist at LPL Financial. “What we get is a 5-7% pullback, which could potentially happen at any moment if we haven’t had one for so long.”

Elsewhere, oil closed the month nearly 10% higher after a tumultuous session in which China reportedly ordered its leading energy companies to secure energy supplies at any cost in the face of shortages, prompting the White House to reiterate its concerns about rising prices.

Here are some of the events to watch this week:

  • Univ. sentiment in Michigan, ISM, manufacturing, US construction costs, expenses / personal income, Friday

Some of the main movements in the markets:

Stock

  • The S&P 500 fell 1.2% as of 4:00 pm New York time.
  • Nasdaq 100 fell 0.4%
  • Dow Jones Industrial Average Down 1.6%
  • MSCI World Index Down 0.6%

Currencies

  • Bloomberg US dollar index fell 0.2%
  • The euro fell 0.1% to $ 1.1581.
  • The British pound rose 0.4% to $ 1.3475.
  • The Japanese yen rose 0.6% to 111.29 per dollar.

Bonds

  • The yield on 10-year Treasuries changed insignificantly and amounted to 1.52%.
  • Germany’s 10-year bond yield rose one basis point to -0.20%.
  • The yield on UK 10-year bonds rose three basis points to 1.02%.

Commodities

  • West Texas Intermediate crude rose 0.2% to $ 75.01 a barrel
  • Gold futures rise 2% to $ 1,756.70 an ounce



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