China Fears Overcome US and Europe’s Financial Stability

The steep and accelerating selloff that pushed the benchmark Standard & Poor’s 500 index into its worst week in almost four years may say more about the outlook for emerging markets than the U.S. companies in the S&P, fund managers and analysts say.

China’s economic slowdown, recessions and weak economies in Latin American countries such as Brazil and Chile and a breakdown in commodity prices are prompting traders to overlook improving U.S. economic data, said Alan Gayle, portfolio manager at RidgeWorth Investments.

“There’s a great deal of nervousness around the weakness in China, and that’s overshadowing the fact that the U.S. economy is sound and the European Union economy is firming,” he said.

As U.S. stock index futures opened for trading on Sunday, they suggested that a moderate decline would continue Monday morning. S&P 500 and Dow Jones index futures ESc1 1YMc1 were down about 0.8 percent shortly before 20:30 GMT, while Nasdaq index futures NQc1 traded down about 0.7 percent.

via Reuters

Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at info@marketpulse.com. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.