S&P500 Erases Drop as Small-Caps Rally; Yen, Gold & Silver Climb
New York (Dec 9) The Standard & Poor’s 500 Index reversed losses as a rebound in small-cap shares blunted the impact of a global equity selloff. The yen gained with gold and Treasuries as concern over Chinese growth and potential political turmoil in Greece boosted demand for haven assets.
Forty more stocks rose as fell on the S&P 500, which closed down less than 0.1 percent at 2,059.82 by 4 p.m. in New York, after earlier sliding as much as 1.3 percent. The Russell 2000 Index (RTY) of smaller companies jumped 1.8 percent. European shares slipped as Greece’s stock index tumbled the most since 1987. The Shanghai Composite Index (SHCOMP) sank 5.4 percent and Brazil’s Ibovespa (IBOV) neared a bear market. Gold futures rose to a six-week high as the yen surged the most in 18 months versus the dollar. Yields on 10-year Treasuries fell five basis points to 2.21 percent.
Smaller energy companies and technology shares drove gains among U.S. equities as oil rallied from a five-year low amid the weakening dollar. China’s move to tighten lending requirements stoked speculation over a slowdown in Asia’s largest economy, sending a gauge of global stocks down 0.4 percent. In Greece, concern intensified that an election could be called, raising the possibility of victory by groups that oppose the terms of the nation’s European Union bailout.
You had some real change in the situation in both China and Greece and yet that wasn’t enough to keep the market down, that’s very bullish,” Matt Maley, an equity strategist for Miller Tabak & Co. in Newton, Massachusetts, said by phone. “With the Russell and Nasdaq up on the day, this is the type of thing that hopefully will get us to break out of the tight range we’ve been in the last week or so. The fact that it couldn’t knock it down should give confidence to investors that we’ll hold on through the end of the year.”
Apple Rallies
Energy stocks in the Russell 2000 jumped 6.1 percent, leading gains among nine industry groups and paring back yesterday’s 7.3 percent tumble. The Nasdaq 100 Index added 0.4 percent as Amazon.com Inc. and Apple Inc. rebounded, while the Dow Jones Industrial Average slipped for a second day, losing 0.3 percent.
The S&P 500 (SPX) dropped 0.7 percent yesterday from a record high and is up 11 percent this year. The MSCI All Country World Index dropped to an almost one-month low.
Source: Bloombverg
