Stocks finished lower, but little changed, on the final trading day of the month and the third quarter. Tuesday saw a volatile session for the market, with the Dow making a 130-point roundtrip from its morning lows to afternoon highs and back again, before finishing with a slight loss. Each of the major stock indexes, however, finished the quarter with gains.
First, the scoreboard:
- Dow: 17,042.9, -28.3 (-0.2%)
- S&P 500: 1,972.29, -5.5, (-0.3%)
- Nasdaq: 4,493.39, -12.5, (-0.3%)
And now, the top stories on Tuesday:
1. Housing prices grew at a slower than expected pace in July, according to the latest S&P/Case-Shiller home price index. The report showed that month-over-month home prices were down 0.5%, and on a year-over-year basis, home prices were down 6.75%. These were lower than expectations for no change on a monthly basis and a gain of 7.4% year-over-year. Following the report, Ian Shepherdson at Pantheon Macro said, “The downshift looks alarming but it won’t last.”
2. The Conference Board’s consumer confidence report for September came in at 86.0, missing expectations for a reading of 92.5. This was the first decline for the report following four straight months of gains. Uncertainty in the job market weighed on this report, with Lynn Franco, director of economic indicators at The Conference Board writing that, “A less positive assessment of the job market, most likely due to the recent softening in growth, was the sole reason for the decline in consumers’ assessment of present-day conditions.”
3. The Chicago purchasing managers index fell to 60.5 in September from 64.3 in August, a bit worse than the 62.0 expected by economists. “Despite September’s fall, the Barometer stands above Q1’s level and the 10-year average of 55.8, with respondents deeming activity levels as ‘strong’ and ‘surging,’ aided by ongoing demand, successful sales promotions and organic growth, all of which called for inventory builds,” ISM-Chicago wrote following the report.
4. Oil prices got slammed on Tuesday, falling more than 3% to nearly $US91 a barrel. Market participants pointed to a number of potential factors that lead to this decline, including a Reuters story indicating that OPEC production is surging and headlines that economic growth in Europe continues to flag.
5. The situation in Hong Kong remains unsettled, with protests continuing ahead of a national holiday in China on Wednesday. Geopolitical expert Ian Bremmer told Business Insider’s Michael Kelley that if the government can’t get the protestors to disperse, we’re likely to see violence.
6. Also in China news, Macau published its worst gaming revenue numbers since the financial crisis, with revenue for the gambling hub potentially falling 12%-13% in September. Some casino stocks, including Las Vegas Sands, MGM, and Wynn all surged on Tuesday, however, as a report from China Daily said that China will wind down an anti-corruption drive.
7. The euro continued to lose ground against the dollar as economic news out of Europe earlier on Tuesday continued to disappoint. Perhaps the most dreary economic situation in the bloc is in Italy, which is experiencing outright deflation, an exceedingly high youth unemployment rate, and a “triple-dip” recession.
8. The situation in Russia is also still a mess, as the ruble made new lows against the dollar today after reports said that Russia is weighing capital controls — or legal limits on how much money you can take out of a country — to stem the outflow of money from Russia.
9. The biggest stock story of the day was news that eBay will spin off its Pay Pal unit into a separate publicly-traded company. The deal is expected to be complete in the second half of next year. Additionally, eBay CEO John Donahoe will step down after the completion of the spinoff. eBay shares gained more than 7% on Tuesday, and Carl Icahn yet again showed why investors follow him into stocks: he gets results. Icahn had long sought to get eBay to separate its PayPal business.