Dow will continue to give in after infrastructure bill is postponed – The Madison Leader Gazette
The stock market fell Friday, a bad start to October after a vote on the $ 1 trillion infrastructure package was put on hold in the heart of President Joe Biden’s economic agenda on Thursday night.
Dow Jones industry average
indicated an opening price 220 points lower after falling 546 points on Thursday to close at 33,843. Futures for the
signaled a similarly weak start.
Overseas, in Asia, Japan
fell 2.3% as analysts found Tokyo traders focused on global events and Chinese markets closed. The pan-European
declined 0.9% as European stocks came under pressure from strengthening
in this week. The greenback has risen 1.3% against the euro since Monday.
October got off to a bad start after the Dow experienced its worst September since 2011 as markets worried about a number of issues including central bank stimulus, inflation, supply chain problems, a debt crisis in China and a global energy crisis.
Many of those fears persisted on Friday as a new trading month began and markets kept a keen eye for the $ 1 trillion vote on the infrastructure bill being put on hold.
Plus: A vote on Biden’s $ 1 trillion infrastructure bill has been postponed. Watch these stocks.
The delay came amid debate among Democrats in Congress over Part Two of Biden’s Agenda – a signature $ 3.5 trillion budget reconciliation package that addresses the US social safety net and climate change initiatives.
“The problem is that some of the more progressive members among the Democrats in the House of Representatives don’t want to vote” [the $1 trillion bill] without the larger reconciliation package that contains much of Biden’s social program agenda, ”said Jim Reid, strategist at Deutsche Bank.
“They fear that the vote on the Infrastructure Act will lead the moderates to cut spending on the Reconciliation Act, so they are using their infrastructure votes as leverage,” added Reid.
Also read: The House is delaying the infrastructure vote as Democratic divisions persist
Congress also faces the challenge of raising or suspending the U.S. debt ceiling before October 18 to avoid a federal default.
The delay in the vote on the Infrastructure Act came after a government shutdown was narrowly avoided. Just hours before the funding expired, Biden signed a makeshift bill to fund the government through December 3.
“If everything looks like a mess, this is it, and markets react appropriately when nerves break,” said Jeffrey Halley, an analyst at broker Oanda.
In the commodities markets, industrial metals futures fell, while aluminum, copper, zinc and tin contracts fell 1.5% to 4.5%. The decline came after a report by Bloomberg that China’s Vice Prime Minister Han Zheng ordered state energy companies to secure energy supplies “at all costs” amid a power crisis in the country.
“It is likely a strong signal of how concerned China is about keeping the industry going and, more importantly, winter is just around the corner,” Halley noted. “If Chinese steel and aluminum smelters are shut down for long periods of time, you can be sure that this will reverberate in the global supply chains.”
Here are eight stocks in motion on Friday:
Infrastructure stocks came under pressure on the $ 1 trillion delay, and so did the steel giant
(NUE), charging group for electric vehicles
(CHPT) and heavy machinery manufacturers
(CAT) stands ready to continue the decline from Thursday.
Universal musical group
(UMG.Netherlands) rose 1.3% in Amsterdam after JPMorgan kicked off its share coverage, which went public last week, with a “buy” rating.
(AIR.France) fell 1.5% in Paris, despite news that Italian airline ITA was planning to lease 31 jets from the company and buy 28 more.
(VWS, Denmark) fell 1.4% in Copenhagen, despite winning a major contract for an undisclosed wind project in Canada.
(MRK) rose 5% in New York’s premarket after positive study data for an oral Covid-19 antiviral drug was revealed.
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