Page 25 - ARUBA TODAY

BUSINESS Friday 16 august 2019
A25

US stocks steady after plunge, but caution still reigns

By STAN CHOE worries that businesses will
Associated Press pull back on their spending
NEW YORK (AP) — Stocks due to all the uncertainty
around the world remained created by the trade war.
stuck in the spin cycle Thurs- Other economies are slow-
day, as worries about a ing as the trade war is do-
possible recession collided ing damage to manufac-
with hopes that the stron- turers around the world.
gest part of the U.S. econ- Those concerns helped
omy — shoppers spending drive the yield on the 10-
at stores and online — can year Treasury down to
keep going. 1.53% Thursday from 1.58%
The S&P 500 clawed back late Wednesday. That yield
some of its steep loss from has been steadily dropping
a day earlier, when stocks since late last year, when it
tumbled after a fairly reli- was above 3%.
able warning signal of re- The 10-year yield has sunk
cession emerged from the so much that it dropped
bond market. Stocks in below the yield of the two-
Asia and Europe, mean- year Treasury Wednesday,
while, sank after China a rare occurrence and one
said it would take "neces- that has historically sug-
sary countermeasures" if Trader Michael Capolino works on the floor of the New York Stock Exchange, Thursday, Aug. 15, gested a recession may be
President Donald Trump 2019. a year or two away.
follows through on a threat Associated Press The 30-year Treasury yield
to impose tariffs on more fell to 1.99% from 2.02%
than $100 billion of Chinese been doing for weeks. in the last three months 0.6% through the morning. and earlier touched a re-
goods on Sept. 1. Prices for everything from than Wall Street expected, A day earlier, it plunged cord low, a sign of concern
The U.S. bond market, stocks to gold to oil have thanks in part to strong on- 2.9%. among investors. When
which has been among been heaving as investors line sales of groceries. A The Dow Jones Industrial worried about weaker eco-
the loudest and earliest to flail from one moment of separate government re- Average rose 125 points, nomic growth and inflation,
cry out warnings about the uncertainty around Trump's port also showed that re- or 0.5% to 25,604, and the they tend to pile into Trea-
economy, also continued trade war to another tail sales across the country Nasdaq composite rose surys, which pushes up their
to show concern as yields around what central banks last month rose more than 0.3%. prices and in turn pushes
fell. will do with interest rates. economists expected. Consumer spending makes down yields.
Trading was again turbu- In the U.S., Walmart shares The S&P 500 was up 0.5%, up the bulk of the U.S. "The countdown to a reces-
lent, and markets around surged 4.3% and helped to as of 12:08 p.m. Eastern economy, and shoppers sion has just started," said
the world jerked up and steady the market after it time after flipping between have been carrying the Hussein Sayed, Chief Mar-
down Thursday as they've said it made a bigger profit a loss of 0.2% and a gain of economy recently amid ket Strategist at FXTM.q

US industrial output fell 0.2% in July as factories struggle

By JOSH BOAK on Wednesday flashed show growth. The pace of
Associated Press signs of a possible reces- manufacturing job growth
WASHINGTON (AP) — U.S. sion. The interest charged has slowed, but the sector
industrial production fell on 10-year U.S. Treasury is not beset by layoffs. The
0.2% in July, as factory ac- notes fell below the rate Institute for Supply Man-
tivity slumped in a worri- charged on 2-year notes, agement, an association
some sign for the economy. usually an indicator that in- of purchasing managers,
The Federal Reserve said vestors see near-term prob- said earlier this month that
Thursday that the overall lems that could cause a its survey shows the sector
decline was caused pri- downturn. is still expanding, though it
marily by a 0.4% drop last Jennifer Lee, a senior econ- has suffered from a slow-
month in manufacturing omist at BMO Capital Mar- down. In this June 24, 2019, file photo Ford's employees work on a Lin-
coln Aviator line at Ford's Chicago Assembly Plant in Chicago's
production. Output de- kets, said the trade war is Other components of the Hegewisch neighborhood.
creased for autos, fabricat- weighing heavily on manu- Fed’s industrial production Associated Press
ed metals, wood products, facturers. report were mixed.
textiles and plastics and “Uncertainty over which Production at the nation’s
rubber products. way it is headed, or how utilities increased 3.1%. Pro-
Over the past 12 months, painful it will be, is prevent- duction at mines, a sector
factory production has ing businesses from moving that also covers oil and
fallen 0.5%. Manufacturers’ too far forward with spend- gas drilling, fell 1.8% as Hur-
struggles reflect a global ing, investing, hiring plans,” ricane Barry temporarily
softening in growth that has she said. halted oil extraction in the
been magnified by Presi- The declining output at fac- Gulf of Mexico.
dent Donald Trump’s use of tories has led some analysts More plant equipment is
tariffs to escalate a trade and politicians to suggest sitting idle. Capacity utiliza-
war with China. The risks that manufacturing has tion slipped in July to 77.5%,
have been great enough entered into its own reces- down 2.2 points from a year
that the financial markets sion. But other indicators still ago.q