Highlights
War jitters whacked equities Friday amid fears of an Iraqi retaliatory strike on Israel and possible widening in the Mideast war. The Dow Jones industrial average lost 1.2 percent, the S&P 500 fell 1.5 percent, and the Nasdaq dropped 1.6 percent. US Treasury yields fell in a flight to quality, the dollar declined, while oil prices rose.
US intelligence reports suggested the strike by Iran or its proxies against Israeli territory was likely in the next few days. Some observers also noted reports that Iran had informed the U.S. that its strike against Israel would be limited and that it hoped to avoid a wider war that might involve the U.S.
Risk appetite also suffered after Chinese economic reports came in softer than expected, which fed concerns about slowing global growth. Separately, earnings season got under way with better than expected results from huge banks including JP Morgan, Wells Fargo, and Citigroup, but the market sold the stocks heavily and financials lagged. Energy stocks outperformed as oil prices jumped on concern about disruption in Mideast oil supplies.
Megacaps and chipmakers had a bad day after their uptick Thursday. Weakest sectors in addition to financials included consumer discretionary, real estate, health care and information technology.
US intelligence reports suggested the strike by Iran or its proxies against Israeli territory was likely in the next few days. Some observers also noted reports that Iran had informed the U.S. that its strike against Israel would be limited and that it hoped to avoid a wider war that might involve the U.S.
Risk appetite also suffered after Chinese economic reports came in softer than expected, which fed concerns about slowing global growth. Separately, earnings season got under way with better than expected results from huge banks including JP Morgan, Wells Fargo, and Citigroup, but the market sold the stocks heavily and financials lagged. Energy stocks outperformed as oil prices jumped on concern about disruption in Mideast oil supplies.
Megacaps and chipmakers had a bad day after their uptick Thursday. Weakest sectors in addition to financials included consumer discretionary, real estate, health care and information technology.
Definition
Market Reflections track market reaction to the trading day's major events. Economic data, policymaker speeches, and company news are featured in this report as well as key indexes and financial instruments.
Description
Understanding why markets respond as they do is fundamental for an investor. Market Reflections help explain how the day's events, news, and data impact the outlook for the economy and for market prices.
