Bombs Drop; Stocks Fall

Boom! Here’s the economic fallout from  the “fallout-less” bomb!

EXPLOSION FOAB russia

CNBC

Stocks fell Thursday after the U.S. dropped “the mother of all bombs” in Afghanistan while bank stocks dropped despite strong earnings from JPMorgan Chase and Citigroup.

The U.S. used a GBU-43 bomb on a cave complex believed to have ISIS fighters, according to the Associated Press. The bomb had ever been used in combat, according to Adam Stump, the Pentagon spokesman.

Goldman Sachs Group Inc

GSPRA

23.54
+0.17
+0.73%
FactSet Research Systems Inc

FDS

157.92
-1.28
-0.80%
Citigroup Inc

C

58.04
-0.47
-0.80%
Wells Fargo & Co

WFC

51.35
-1.77
-3.33%

Stocks extended losses shortly after news of the bombing broke. The Dow fell 100 points, with Chevron and Goldman Sachs contributing the most losses, before recovering to trade about 60 points lower. The S&P 500 was down 0.3 percent after falling nearly 0.5 percent, with energy and financials leading decliners. The Nasdaq was down by 0.1 percent, also off its lows.

“People are nervous in front of the long weekend,” said Art Cashin, the director of NYSE floor operations for UBS. “I would give that about a quarter of the move. The rest of its worries about the financials.” The U.S. stock market is closed Friday due to a holiday.

The Financials Select Sector SPDR Fund ETF gave back initial gains to trade nearly 1 percent lower. The ETF has also fallen more than 2 percent this week and gave up its gain for the year on Wednesday.

“It’s a market in search of a catalyst that hasn’t found one yet to fully justify this fast move higher,” said Mark Luschini, a chief investment strategist at Janney Montgomery Scott. “I think the market has no reason to buy, rather than having a reason to sell.”

The Dow fell 68 points, with Chevron and Exxon Mobil contributing the most losses. The S&P 500 was off by 0.3 percent, with energy and financials leading decliners. The Nasdaq slipped 0.15 percent.

So-called risk-off trades have been in vogue this week, with gold, Treasurys and the Japanese yen were all tracking for gains. The three major U.S. indexes, meanwhile, were on pace to end the week slightly lower.

Traders grew nervous this week as overseas tensions between the U.S. and Russia heated up as State Secretary Rex Tillerson flew to Moscow to meet his Russian counterpart, Sergey Lavrov.

Also, Wall Street grew jittery as it gauged where the Trump administration’s priorities were. On Wednesday, President Donald Trump told Fox Business he wanted to repeal and replace Obamacare before moving on to tax reform.

Trump told the Wall Street Journal later on Wednesday he thought the dollar was getting “too strong.” The comment sent the dollar index to its lowest level of the month against a basket of currencies; it last traded 0.4 percent lower at 100.38.

“I’m a proponent of neither a strong nor weak currency but a stable one and believe that we should be careful here in hoping for a weak currency (or just not a strong one which I get) Mr. President,” said Peter Boockvar, a chief market analyst at The Lindsey Group, in a note.

“Just look at the experience of Japan where consumer spending remains punk and the weak currency hasn’t led to any noticeable impact on export volumes,” he said.

Also, some prominent investors have come out this week saying the stock market may be overvalued.

ValueAct Capital’s Jeff Ubben said Wednesday he is “skeptical” of the market’s valuation, adding the firm is returning $1.25 billion to investors. Janus’ Bill Gross wrote in his monthly investment outlook that the stock market has “priced for too much hope.”

That said, equities have managed to hold their ground somewhat, as they have avoided a major sell-off recently.

“There’s been a lot of news over the past few days and we’re still in a holding pattern,” said Scott Clemons, a chief investment strategist at Brown Brothers Harriman. “I think investors are more focused on earnings.”

JPMorgan Chase, Citigroup and Wells Fargo all reported quarterly results. JPMorgan easily topped expectations. Citigroup also posted better-than-expected results. Wells Fargo was mixed.

“It sort of gives investors some comfort that the high valuations and earnings expectations may be correct,” Brown Brothers Harriman’s Clemons said.

In economic news, jobless claims came in at 234,000, below expectations, while March PPI declined 0.1 percent. Consumer sentiment came in at 98, beating expectations

Martin Harris

I have a lovely partner and 3 very active youngsters. We live in the earthquake ravaged Eastern Suburbs of Christchurch, New Zealand. I began commenting/posting on Uncensored back in early 2012 looking for discussion and answers on the cause and agendas relating to our quakes. I have always maintained an interest in ancient mysteries, UFOs, hidden agendas, geoengineering and secret societies and keep a close eye on current world events. Since 2013 I have been an active member of theCONTrail.com community, being granted admin status and publishing many blogs and discussion threads. At this time I'm now helping out with admin and moderation duties here at Uncensored where my online "life" began.

Next Post

MOAB Bomb Drop On Afghanistan. Alternative World News and Official White House Briefing Videos

Fri Apr 14 , 2017
https://www.youtube.com/watch?v=zdy0FIidPgs  

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