|Day's Range||2,617.27 - 2,657.88|
|52 Week Range||2,346.58 - 2,940.91|
As Monday's data shows that there is a slowdown in China's economy, Harvard University’s Public Policy and Economics Professor Kenneth Rogoff says China is becoming a real problem.
After record earnings growth in 2018, corporate executives continue to temper their views on the economy for the year ahead, keeping investors on edge amid a market rebound to start 2019.
"There is a feeling that the stock market might be due for some deflating now because it's been a long time, and we've seen some hints of it and we haven't seen the real deflation yet," he told CNBC at the World Economic Forum (WEF) in Davos, Switzerland. U.S. stock markets may have recovered slightly from sharp falls at the end of last year, but there's still a risk of a significant downward trend, Robert Shiller, a professor of economics at Yale University and a Nobel laureate, told CNBC Wednesday.
Trade, shutdowns and weak economic data is weighing on industrial shares. Here’s how should investors position themselves for coming industrial earnings.
The yen slid as the Bank of Japan cut its inflation outlook. The Stoxx Europe 600 Index reversed an early decline as a positive report from Carrefour SA boosted retailers, offsetting a drop in technology shares amid a disappointing sales forecast from the region’s biggest chipmaker. Shares were mixed in Asia, and the yen weakened further against the dollar after the Bank of Japan left its policy unchanged while cutting its inflation outlook again.
Renewed concerns about a global economic slowdown continued to sap investor appetite for assets considered risky, dragging global stocks and bond yields lower on Wednesday, while the U.S. dollar held near three-week highs. Trading was choppy overnight as hopes of more stimulus measures from China to shore up economic growth clashed with worries over progress between Washington and Beijing to resolve a trade spat between the world's top two economies. The mood soured overnight after a report in the Financial Times that the Trump administration had rejected an offer from China for preparatory trade talks this week ahead of high-level negotiations scheduled for next week.
As the gathering of global elite got underway, investors and even former central bankers were quick to cast blame on the Fed and its counterparts for disrupting financial markets in the final months of 2018. Ray Dalio of Bridgewater Associates LP chalked it up to an “inappropriate desire” to tighten monetary policy faster than markets could handle. Philipp Hildebrand, vice chairman of BlackRock Inc. and a former governor of the Swiss National Bank, said “the key risk is a policy mistake,” given that the outlook for global growth is slowing, according to the latest forecast from the International Monetary Fund. At the same time, Hildebrand said: “What worries me most is if we were to run into a serious problem, a recession or something worse, we would have very limited firepower left to respond to it.” UBS Group AG Chairman Axel Weber, a former president of the Bundesbank, lamented that central banks didn’t raise rates during better times.
Brian Reynolds, a strategist at Canaccord Genuity, wrote in a report last week that the equity bull market will continue in large part because of “debt-fueled buybacks.” And at least some of those buybacks seem to be on their way. Fox Corp. and Charter Communications both did did bond deals, of $6.8 billion and $2 billion, respectively, and said the purpose was to raise cash for dividends and buybacks, though there is nothing forcing them use the proceeds that way.What’s more, corporate America has promised more in stock repurchases than it has completed, meaning the buyback train has already been loaded up with fuel. Last year, companies in the S&P 500 announced plans to buy back just more than $1.1 trillion worth of their own stock, according to Birinyi Associates.
U.S. stock index futures fluctuated ahead of Wednesday's open, trying to shake off the negative trading seen in the previous session and in some international markets.
On the earnings front, a slew of companies are due to report, including Abbott Labs, Comcast, Procter & Gamble, Kimberly-Clark, Ford and F5 Networks. Investors will keep abreast of domestic politics as the longest-ever government shutdown continues to wreak havoc and trigger uncertainty across the U.S. Around 5:30 a.m. ET, Dow futures popped 81 points, indicating an open of 93.52 points up.