Stocks Weaken on Slower Growth
Stocks weaken late day...the immediate cause appears to be the piercing of the 50-day moving average for the S&P 500 (1310)...and yes technicals can matter in an uncertain environment.
No word on a debt ceiling deal from Washington is certainly not helping, but it's clear the real problem is comments about slower growth...from everyone from the Fed's Beige Book ("economic activity continued to grow; however, the pace has moderated in many Districts") to Juniper to Emerson Electric who said "...we have seen a definite weakening of general business activity in June and July."
Ah, you say, but global growth has been strong...but wait...Brazil's Bovespa is now down 20 percent from its high, officially in bear market territory. Growth is also slowing in China, and India.
True, the Brazilian real is appreciating fast against the dollar, hurting exports of Brazilian products. Brazil for the first time targeted trading in the derivatives market, implementing a financial transactions tax on derivatives to control investment there.
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