Stocks Slide With Pound Amid Renewed Worries Over Global Growth

[Purveyor]

Stocks slid with the pound as signs of slowing growth in Europe and comments from Bank of England Governor Mark Carney rekindled worries over the outlook of the global economy. Bond yields tumbled to all-time lows and crude sank.

Energy producers and banks were among the biggest drags on the S&P 500 Index, as 10- and 30-year Treasury yields dropped to unprecedented levels. The pound fell to its weakest since 2013 against the euro after Carney warned of “the prospect of a material slowing of the economy.” Oil dropped below $47 a barrel after the world’s top oil trader said prices won’t rise much further.



Risk assets faltered Tuesday after purchasing managers’ indexes on manufacturing and services signaled lackluster growth in the euro area in June. Global equities had rallied last week after Britain’s vote to exit the European Union spurred assurances by central bankers that they are prepared to loosen monetary policy, while bets on the odds of an interest-rate hike by the Federal Reserve this year evaporated. A U.S. jobs report July 8 may offer clues to the direction of the Fed’s next move.

“The factors driving the market today are fears of financial contagion coming out of European banks, the drop in oil prices and currency weakness,” said Michael Sheldon, chief investment officer of Northstar Wealth Partners, which oversees $1.1 billion in West Hartford, Connecticut. “Investors came back after the long weekend and decided that maybe the run-up in prices following Brexit may have been overdone to the upside.”

more...

http://www.bloomberg.com/news/articles/2016-07-04/asian-stock-outlook-clouded-with-silver-in-demand-as-crude-falls

[Wellstone ruled]

1. Or is this the second leg

of the 10 trillion dollar wealth transfer from you and I and all those who have 401k's and IRA's. Round one was the major shrinkage of all UK residents wealth by 3 trillion. More to come I'am sure.

[nitpicker]

2. (morning update) Brexit: pound plunges to 30-year lows as EU fears bite into global markets again

https://www.theguardian.com/business/2016/jul/06/brexit-pound-plunges-to-30-year-lows-as-eu-fears-bite-into-global-markets-again

Brexit: pound plunges to 30-year lows as EU fears bite into global markets again

Sterling drops well below $1.30 barrier to hit lowest levels since 1985

Wednesday 6 July 2016 06.24 BST Last modified on Wednesday 6 July 2016 07.28 BST


The pound sank to three-decade lows and Asian share markets fell on Wednesday as fears over Brexit and instability in the European Union returned with a vengeance.
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In wild trading reminiscent of the fateful Friday when Britain voted to abandon the EU, sterling shed a full US cent in a matter of minutes on Wednesday to sink to $1.2798 at one point.

Against the resurgent Japanese currency, sterling fell as low as 128.81 yen, its lowest since November 2012.

Concerns about the impact on already fragile global growth spread to commodity markets. After oil prices shed 5% on Tuesday, Brent crude futures fell further on Wednesday to $47.57, with US crude at $46.21 at one point.
(snip)

The yen benefited broadly as a traditional safe harbour and climbed to 100.94 a US dollar. Likewise, spot gold hit its highest since early 2014 at $1,370.60.

Dealers said there was no one event behind the moves but rather an accumulation of negative factors. Three British commercial property funds worth about £10bn suspended trading as asset prices plunged, while the Bank of England had to take action to ensure local banks kept lending.
(snip)