S&P Slumps at End of Dizzying Quarter for Stocks: Markets Wrap

On Sep 30, 2021

(Bloomberg) — Volatility continued to roil risk assets, with energy prices spiking higher and U.S. equities sliding toward their worst quarter since the start of the pandemic.

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Economically sensitive companies led losses in the S&P 500, with the gauge on track for its lowest level since July. A poor forecast at Bed Bath & Beyond Inc. and supply-chain worries at Kohl’s Corp. dragged retailers lower. Oil resumed its advance, while natural gas spiked.

Political wrangling in Washington is threatening to push the U.S. into default and force President Joe Biden to scale back his spending agenda. Democratic Senator Joe Manchin wants the tax and social spending bill that would encompass the bulk of Biden’s economic agenda whacked back to $1.5 trillion — less than half the outline written by congressional Democrats. House Speaker Nancy Pelosi is pushing ahead with a vote on a bipartisan infrastructure bill, despite threats from progressive Democrats.

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“The old adage, the market climbs a wall of worry, is not lost on us,” said Tom Mantione, managing director at UBS Private Wealth Management. “Worries about China, the pandemic, the debt ceiling and tax legislation are weighing on investors right now, but it is important to understand which issues may create structural change and which ones create short-term volatility that investors can take advantage of.”

China’s central government officials ordered the country’s top state-owned energy companies — from coal to electricity and oil — to secure supplies for this winter at all costs, according to people familiar with the matter.

Here are some events to watch this week:

Univ. of Michigan sentiment, ISM manufacturing, U.S. construction spending, spending/personal income, Friday

For more market analysis, read our MLIV blog.

Some of the main moves in markets:

Stocks

The S&P 500 fell 0.7% as of 12:52 p.m. New York time
The Nasdaq 100 was little changed
The Dow Jones Industrial Average fell 1.2%
The MSCI World index fell 0.4%

Currencies

The Bloomberg Dollar Spot Index fell 0.2%
The euro fell 0.2% to $1.1574
The British pound rose 0.3% to $1.3466
The Japanese yen rose 0.5% to 111.44 per dollar

Bonds

The yield on 10-year Treasuries was little changed at 1.52%
Germany’s 10-year yield advanced one basis point to -0.20%
Britain’s 10-year yield advanced three basis points to 1.02%

Commodities

West Texas Intermediate crude rose 1.4% to $75.87 a barrel
Gold futures rose 2% to $1,758.10 an ounce