Page 25 - ARUBA TODAY

BUSINESS Wednesday 30 May 2018
A25

Global stocks slump amid Italian political turmoil

By MARLEY JAY Monday for the Memorial U.S., as it makes their prod-
Associated Press Day holiday. ucts more expensive in
NEW YORK (AP) — Stocks Italian President Sergio overseas markets. Among
in the U.S. and Europe are Mattarella picked Carlo industrial companies, con-
sinking Tuesday following Cottarelli for prime minister struction equipment maker
a flare-up of political tur- after the anti-establishment Caterpillar shed 1.7 per-
moil in Italy, which stoked 5-Star Movement and cent to $153.27 and farm
fears of instability in the right-wing League refused equipment maker Deere
euro bloc. Bond prices are to withdraw an anti-euro fell 2.7 percent to $154.78.
climbing and yields are candidate as economy Health care products gi-
plunging, while the euro fell minister. That ended their ant Johnson & Johnson fell
to its lowest level against attempt to establish a gov- 2 percent to $119.20 and
the dollar in almost a year. ernment after inconclusive drugmaker Abbott Labs
The drop in U.S. bond yields elections in March. Cot- lost 2.2 percent to $60.99.
is causing big losses for tarelli is likely to lose a vote All of those companies
banks. Lower yields force of no confidence in parlia- get about half their rev- Trader Edward Curran, left, and specialist James Denaro work
interest rates down on ment, which would mean enue from outside the U.S., on the floor of the New York Stock Exchange, Tuesday, May 29,
mortgages and other kinds another round of elections. while almost two-thirds of 2018.
of loans, meaning thinner Investors dumped Italian Abbott's sales come from Associated Press
profits for banks. Major ex- stocks and bonds as a re- overseas.
porters like technology and sult. Italy's FTSE MIB stock Technology companies, America, but some fore- said it will buy an oil pipe-
industrial companies are market index lost 2.7 per- which get more of their rev- casts were as high as $150 line to the Pacific coast to
also falling. cent and yields on Italian enue from outside the U.S. million. ensure it gets built. Kinder
The political upheaval in government bonds soared than any other part of the U.S. crude oil fell 2.8 per- Morgan will get $3.4 billion
Italy is likely to lead to new as their prices declined. The S&P 500, also fell. Google's cent to $66 a barrel in in the deal. The company
elections this fall, and in- yield on the 10-year Italian parent company Alphabet New York. Oil prices have halted essential spending
vestors are interpreting the government bond jumped lost 1.5 percent to $1,068.21 slumped in the last week on the project and said it
upcoming vote as a refer- to 3.10 percent from 2.69 and Mastercard fell 2.3 per- following reports that OPEC would cancel it if the na-
endum on Italy staying in percent, a huge move. cent to $186.80. countries and Russia could tional and provincial gov-
the euro. They're worried That reflects weakening Disney skidded 2.7 per- start pumping more oil ernments could not guar-
about decreased interna- confidence among inves- cent to $99.45 after its lat- soon. Brent crude, used to antee it.
tional cooperation in Eu- tors in Italy's government. est Star Wars film made far price international oils, lost In Asia, Japan's Nikkei 225
rope, which could impair The German DAX lost 1.5 less money than experts 0.5 percent to $74.95 per fell 0.6 percent while the
global economic growth. percent and Britain's FTSE expected over the holiday barrel in London. South Korean Kospi lost
Those same worries led to 100 sank 1.3 percent. The weekend. Disney said "Solo: Kinder Morgan climbed 0.9 percent. Hong Kong's
a big drop two years ago French CAC 40 slumped 1.3 A Star Wars Story" will gross 2 percent to $16.20 after Hang Seng index plunged
after Britain voted to leave percent. about $101 million in North the Canadian government 1 percent.q
the European Union, al- The dollar rose to 108.57 yen
though that skid proved to from 109.37 yen. The euro
be short-lived. sank to $1.1551, its lowest
Investors sold stocks, espe- since July, from $1.1669.
cially companies that de- Spain was facing politi-
pend on strong sales out- cal turbulence of its own.
side the U.S. like technology That country's parliament
and industrial companies will hold a vote of no con-
and big drug and health fidence in Prime Minister
care products makers. Mariano Rajoy after graft
They bought government convictions of businesspeo-
bonds in the U.S. as well as ple and officials tied to his
Germany and the U.K. That conservative Popular Party.
sent prices for those bonds All major parties, except for
higher and yields lower. the ruling People's Party,
The S&P 500 index sank 33 are calling for Rajoy to step
points, or 1.2 percent, to down. The Spanish IBEX 35
2,688 as of 12:40 p.m. East- sank 2.5 percent.
ern time. The Dow Jones U.S. government bond
industrial average lost 385 prices rose as investors
points, or 1.5 percent, to moved money into lower-
24,372. The Nasdaq com- risk assets. The yield on the
posite fell 43 points, or 0.6 10-year Treasury fell to 2.82
percent, to 7,390. percent from 2.93 percent
Smaller companies, which late Friday, a large move.
tend to be more U.S.-fo- That sent interest rates
cused than the large multi- lower, which reduces prof-
nationals in the Dow, fared its for banks. JPMorgan
much better than the rest Chase dropped 3.7 per-
of the market. The Russell cent to $106.58 and Bank
2000 index fell just one-fifth of America fell 3.5 percent
as much as the Dow aver- to $29.10.
age, giving up 5 points, or When the dollar gets stron-
0.3 percent, to 1,621. ger, it can hurt companies
U.S. markets were closed that export goods from the