Here are the key news, trends, and analysis investors need to start their trading day:
1. The Dow will decline as it tries to hold its weekly turnaround
The Dow’s 506 point rise on Thursday and 338 points rise on Wednesday more than offset the slight decline on Tuesday and the 614 point fall on Monday. The S&P 500 also posted consecutive gains. The Nasdaq advanced for three sessions in a row. All three equity benchmarks were still in the red for the month, but were around 2% behind their most recent record closings.
Shares in Dow-stock Nike fell 5% in the premarket on Friday, the morning after the company said global supply chain congestion is hurting business more than expected. The sneaker giant lowered its outlook for fiscal year 2022. Nike beat earnings estimates but missed sales.
2. Bitcoin drops as China steps up crackdown on cryptocurrencies
Budrul Chukrut | LightRakete | Getty Images
Bitcoin crashed on Friday, with traders rocked by tough talks from China over cryptocurrencies. In a question and answer posted on its website, the People’s Bank of China said that services that offer trading, order matching, token issuance and virtual currency derivatives are strictly prohibited. Overseas crypto exchanges offering services in mainland China are also illegal, China’s central bank said. Bitcoin fell 7% to below $ 42,000. It hit an all-time high of over $ 64,000 in April but sold out in June and July, even falling just below $ 30,000. Bitcoin had been gaining ground since mid-July, hitting a recent high of around $ 52,000 earlier this month.
3. Bond yields rise as fears of China Evergrande contagion wane
Apartment buildings and leisure facilities in the real estate and tourism development project Life in Venice of the China Evergrande Group in Qidong, Jiangsu province, China, on Tuesday, September 21, 2021.
Qilai Shen | Bloomberg | Getty Images
The 10-year US Treasury yield rose to over 1.42% on Friday, returning to its July highs. Yield, moving in the opposite direction from price, retreated earlier this week as investors sought safety and bought bonds as the deteriorating health of China Evergrande Group’s stocks tumbled on Monday. However, as concerns about the risk of financial contagion if the Chinese real estate giant collapsed, US Treasury bond prices fell and yields rose. Evergrande has not said whether it will make a $ 83 million payment on a US dollar bond due Thursday. The competitive Chinese developer made a payment for a local bond on Wednesday.
4. CDC boss overrides committee, releases Pfizer boosters for frontline employees
The head of the Centers for Disease Control and Prevention on Friday overruled an advisory body and approved the distribution of Pfizer’s Covid boosters to a wide variety of workers in the United States. CDC director Dr. Rochelle Walensky signed a number of the panel’s recommendations, including distributing the syringes to older Americans and adults with underlying conditions at least six months after their second syringe. But in a usual move, she broke off the panel by also releasing boosters for those in high-risk professional and institutional settings.
5. Costco is resetting the restrictions on buying toilet paper and other items
Costco’s CFO said the company is placing some purchasing restrictions on essential items, including toilet paper, paper towels, bottled water and high-demand cleaning products. During Costco’s post-earnings call on Thursday, CFO Richard Galant said the limits are being imposed for a different reason than before in the pandemic. “There was a shortage of goods a year ago,” he said. “Now they have a lot of goods, but there is a two or three week delay in delivery.” Costco beat estimates with its latest quarterly results.
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Correction: This version corrects that the Dow, S&P 500 and Nasdaq were positive for the week at Thursday’s closing price, not for the month.