US markets slide on new home sales and consumer confidence data

The Dow Jones Industrial Average fell Tuesday after the latest home sales and consumer confidence reports stoked concern over the state of the US economy.

August new home sales missed expectations. Homes under contract totaled 675,000 for the month, down 8.7 per cent from July, according to the Commerce Department. Economists polled by Dow Jones anticipated a total of 695,000, which would have represented a 2.7 per cent fall from unrevised July totals.

The Conference Board’s consumer confidence index fell to 103 in September, down from 108.7 in August. Economists were anticipating 105.5, according to consensus estimates from Dow Jones. The expectations index tumbled to 73.7, below the level that observers associate with recessions.

Investors this week are also grappling with negotiations in Washington, as lawmakers hope to avert a government shutdown that could take place as early as Oct. 1 if Congress doesn’t agree on a spending bill.

Still, upcoming seasonal market tumult could present a window for investors. Though October is known as the “jinx month” because of the 1929 and 1987 crashes, it also has a reputation as a “bear killer,” according to the “Stock Trader’s Almanac.”

The Dow lost 388.00 points, or 1.14 per cent, to 33,618.88 in its worst day since March. The 30-stock index closed below its 200-day moving average for the first time since May.

The S&P 500 slid 1.47 per cent to 4,273.53, closing below 4,300 for the first time since June 9. Meanwhile, the Nasdaq Composite pulled back 1.57 per cent to 13,063.61.

Amazon shares fell 4 per cent — the most of the mega-cap tech stocks — after the Federal Trade Commission filed an antitrust lawsuit, saying the online retailer keeps prices artificially high and hurts rivals.

JPMorgan Chase CEO Jamie Dimon warned interest rates may need to rise further to tamp down inflation, comments that added to bearish sentiment Tuesday. Bank stocks declined, with the SPDR S&P Regional Banking ETF (KRE) falling more than 1 per cent. Wells Fargo shares dropped about 2 per cent, while Morgan Stanley fell 1 per cent.

OpenAI, the creator of ChatGPT, is in discussions with investors regarding a potential stock offering. This move could potentially value the startup at an impressive range of $80 billion to $90 billion, according to a report from the Wall Street Journal.

Turning to US sectors, all closed lower overnight. Utilities suffered the worst losses, closing 3.1 per cent lower.

Futures

The SPI futures are pointing to a 0.3 per cent fall.

Currency

One Australian dollar at 7:20 AM was buying 63.98 US cents.

Commodities

Gold lost 0.87 per cent. Silver dropped 0.81 per cent. Copper fell 0.57 per cent. Oil gained 0.79 per cent.

Figures around the globe

European markets closed mixed. London’s FTSE added 0.02 per cent, Frankfurt lost 0.97 per cent, and Paris closed 0.70 per cent lower.

Turning to Asian markets, Tokyo’s Nikkei dropped 1.11 per cent, Hong Kong’s Hang Seng fell 1.48 per cent while China’s Shanghai Composite closed 0.43 per cent lower.

The Australian sharemarket closed 0.54 per cent lower at 7,038.

Ex-dividends

Cedar Woods Prop (ASX:CWP) is paying 7 cents fully franked
Fonterra Share Fund (ASX:FSF) is paying 31.296 cents unfranked
Imdex Limited (ASX:IMD) is paying 2.1 cents fully franked
Myer Holdings Ltd (ASX:MYR) is paying 1 cents fully franked
Vulcan Steel (ASX:VSL) is paying 25.9265 cents 92.79 per cent franked

Dividends payable

Amcor PLC (ASX:AMC)
Ampol Ltd (ASX:ALD)
ASX Ltd (ASX:ASX)
Aurizon Holdings Ltd (ASX:AZJ)
Coles Group Ltd (ASX:COL)
Diverger Ltd (ASX:DVR)
Endeavour Group Ltd (ASX:EDV)
Iluka Resources Ltd (ASX:ILU)
Mineral Resources Ltd (ASX:MIN)
NZME Ltd (ASX:NZM)
Pilbara Minerals Ltd (ASX:PLS)
Regis Healthcare Ltd (ASX:REG)
Woolworths Group Ltd (ASX:WOW)
Worley Ltd (ASX:WOR)

Sources: Bloomberg, FactSet, IRESS, TradingView, UBS, Bourse Data, Trading Economics, CoinMarketCap.

Disclaimer

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