Markets gave back most of their modest Friday gains.First the scoreboard:
Dow: 13,169, -38.5, -0.2%
S&P 500: 1,404, -1.7, -0.1%
NASDAQ: 3,022, +1.6, +0.0%
And now the top stories:
- So, the big news was that Republican presidential candidate Mitt Romney selected Paul Ryan to be his running mate. Here’s everything you need to know about Paul Ryan >
- Nomura economist Lewis Alexander was one of the first Wall Streeters to comment on the choice. Basically, Alexander thinks that the Ryan pick will strengthen support for fiscal tightening and also amplify the fiscal cliff debate. “Both of these factors may be a headwind for risky assets in coming months,” he writes. “In effect, with this choice concerns about the “fiscal cliff” may affect markets somewhat sooner than we had earlier thought.”
- In a new note to clients, Morgan Stanley’s Adam Parker noted that his bearish call on stocks “did not take into account the Fiscal Cliff in any way.” He also presented his “extreme bear case scenarios” where S&P 500 earnings could fall 28-44 per cent in 2013. Under those circumstances, the S&P 500 would likely fall below 1,000.
- However, UBS economist Drew Matus wonders if we’re blowing the whole fiscal cliff issue out of proportion. “Is the ‘fiscal cliff’ another ‘Y2K’?” he asked rhetorically. “Generally speaking, widely anticipated problems do not materialise if they are addressed.”
- Last night, we learned that Japanese GDP slowed to 1.4 per cent in Q2, which was much lower than the 2.3 per cent that economist were looking for. The Asian markets sold off modestly on the news.
- Groupon will be releasing its quarterly financial results this afternoon. Follow the release LIVE at Business Insider.
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