Asian Stocks Follow Wall Street Lower

Andrew Cummings
April 28, 2018

On Wednesday Goodyear Tire & Rubber said higher raw materials costs and weaker demand hurt its business in the first quarter. Japan's benchmark Nikkei 225 shed 0.3 percent.

Stocks skyrocketed in 2017 on hopes that USA tax cuts would spur more economic growth.

Coming off its longest losing streak in more than a year, the Dow Jones Industrial Average (DJI) is signaling a positive start. It was down as much as 619 earlier.

The S&P 500 was also down by 1.3% to 2,634.56 points. Earlier it peaked at 3 percent for the first time since January 2014.

The tech industry was the main driver of the market losses today as Wall Street analysts lowering profit estimate from tech giant Google, which lost $36 billion.

The initial growth in the markets was thanks to Caterpillar, which reported higher than expected profit and revenues.

Comcast rose 3.7 percent after the USA cable company submitted a $31 billion offer for pay-TV group Sky, challenging an already agreed but lower takeover bid from Rupert Murdoch's Fox.

Shares of Goodyear Tire & Rubber CO (NASDAQ:GT) fell more than 5% by the end of the day after reporting disappointing first quarter results. Elsewhere, aerospace company Boeing lost 2.9 percent to $329.06.

The Morningstar Small Cap Index was also nursing losses, down 31.9 points, or 0.3%, to 6,640.1. The Nasdaq gave up 144 points, or 2 percent, to 6,984.

Australian shares are expected to push higher, as Wall Street alternated between gains and losses, before ending its day with mixed results.

Investors reacted negatively to the news that the benchmark 10-year Treasury yield had traded up to 3.03 percent. Verizon, Harley-Davidson and Fifth Third Bancorp all rose. Heating oil dipped 0.6 percent to $2.13 a gallon. Meanwhile, interest rates jumped to levels not seen in years. The investors sell American government securities because of expectations of rising inflation.

PAYING THE COST: Stocks slumped Tuesday after heavy machinery maker Caterpillar said it doesn't expect to top its first-quarter earnings for the rest of this year.

METALS: Gold rose 0.7 percent to $1,333 an ounce.

Follow the Dow Jones industrial average. The Nasdaq increased 11 points, or 0.2 percent, to 7,139.

Since the global financial crisis in 2008-09, a combination of low inflation expectations and a bond-buying program by the Federal Reserve have helped keep bond yields low, but they have climbed this year as inflation expectations have picked up.

Exxon Mobil rose 1.5 percent after raising its dividend.

Drugmaker Shire rose 3.3 percent after saying it had received another takeover offer from Japanese rival Takeda. Natural gas rose 1.5 percent to $2.78 per 1,000 cubic feet.

The 10 year bond rate is the highest in about four years and just a point or two away from the highest since 2011, so it's been tempering equities, said Currie.

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