Wednesday 21 August 2013

Stocks fall except in US

Asian stocks tumbled again on Tuesday. The Indonesian stock market was again the big loser, falling 3.2 percent, after having fallen 5.6 percent on Monday. Japanese stocks fell 2.6 percent.

Stocks also fell in Europe on Tuesday. The STOXX Europe 600 lost 0.8 percent.

However, US stocks managed to shrug off the losses elsewhere. The S&P 500 rose 0.4 percent on Tuesday as the 10-year Treasury yield fell 6.4 basis points to 2.82 percent.

Despite the gain in the US, the MSCI All-Country World Index still ended the day down 0.2 percent.

Markets have mostly fallen on anticipation of the Federal Reserve tapering its bond purchases.

However, a report from the Chicago Federal Reserve on Tuesday indicated that US economic growth remained relatively weak at the start of the third quarter.

The Chicago Fed's national activity index edged up to -0.15 in July from -0.23 in June. This pushed the three-month moving average also to -0.15 in July from -0.24 in June.

While the three-month moving average rose for the second consecutive month in July, it remained below zero, suggesting, according to the report, that US economic growth was below its historical trend.

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