Date: 2025-10-05 Page is: DBtxt003.php txt00026927
US INVESTING
WHY ARE MARKETS AT NEAR RECORD HIGHS?
Why the Dow fell 1,000 points in the last three days
WHY ARE MARKETS AT NEAR RECORD HIGHS?
Why the Dow fell 1,000 points in the last three days
Robust economic data has spooked investors, who worry that signs of a stronger
economy could push the Federal Reserve to keep interest rates higher for longer
as it battles to bring down inflation. Michael M. Santiago/Getty Images
Original article: https://www.cnn.com/2024/05/30/investing/dow-jones-down-markets-explainer/index.html#
Peter Burgess COMMENTARY
Most of the financial reporting I see is confusing. I have concluded that many of the reporters are angry that the policies of Biden and the Democrats is delivering a fairly strong economy now and the prospect of an even better economy in the future. Maybe it is not so much the reporters but the employers of the reporters who have nowhere to turn given the chaos that is the modern GOP.
I am waiting to see an explanation of why the US stock markets are hitting record highs when according to the media, the economic situation is so bad.
The past three weeks has seen the Dow decline significantly, but it went over 40,000 a couple of weeks back! The big part of the press seems to think that things were better when Trump was in office ... talk about an alternative reality.
Peter Burgess
Written by Nicole Goodkind, CNN
Updated 4:07 PM EDT, Thu May 30, 2024
US markets have had a rough week. The Dow has fallen by around 1,000 points over the last three days alone — and the negative momentum didn’t let up Thursday.
New York CNN
The Dow closed 331 points lower, or 0.9%. The S&P 500 was down 0.6% and the Nasdaq Composite dropped 1.1% as lackluster earnings results from Salesforce (CRM) worried investors.
Shares of the customer relationship management company fell 19.7% after it reported a revenue miss and lowered expectations for the year ahead, notching its worst day in two decades.
That comes after a bad Wednesday for the broader market, with all 11 sectors of the S&P 500 closing lower. The Dow fell by more than 300 points, driven largely by a tick down of shares of chipmaking giant Nvidia (NVDA), pulling large tech stocks down along with it.
This week’s downturn has been fueled by a range of factors, including earnings and stronger-than-expected economic data. Bonds have taken a particular hit as concerns about inflation mount and after a weak Treasury auction on Wednesday. The 10-year Treasury yield climbed to its highest level since late April.
Robust economic data has also spooked investors, who worry that signs of a stronger economy could push the Federal Reserve to keep interest rates higher for longer as it battles to bring down inflation.
Despite the robust labor market, there are warning signs in the US economy right now.
RELATED ARTICLE
What’s really happening in America’s economy (Trump and Biden spin aside)
The S&P 500 has finished higher for 23 of the last 30 weeks, marking a joint record since 1989, but it’s now tracking toward a negative week.
“There had already been a relentless run of gains in recent weeks that was always going to be tough to maintain,” wrote Deutsche Bank analysts on Thursday. “It’s clear that the momentum is now more negative.”
New economic data on Thursday showed that US gross domestic product in the first quarter was revised lower (1.3% from 1.6%) and that personal consumption is slowing. That’s a sign that economic expansion is cooling — which some analysts view as a double-edged sword.
The data “could be a concern for companies and stock market investors, but on the other hand, slowing consumption and economic growth could be just the news we need to see in order for the rate of inflation to keep coming down and allow the Fed to reduce interest rates after all,” wrote Chris Zaccarelli, chief investment officer at Independent Advisor Alliance, on Thursday.
All eyes, meanwhile, are on the release of the Personal Consumption Expenditures index for April on Friday — the Fed’s preferred inflation gauge.
MORE FROM CNN
Stocks pare losses after sliding on worries about the economy’s health There’s a surprising bit of good news lurking in the stock market New York Stock Exchange says bizarre glitch that showed ... CNN BUSINESS VIDEOS FST rich man One-on-one with Africa’s richest man FST oil africa Inside Africa’s largest oil refinery FST bold swimwear Andrea Iyamah’s bold swimwear fuses African heritage with modern flair FST james masterclass Why Veekee James is spilling trade secrets to aspiring fashion designers