The Chinese decided to step up the “let’s devalue our currency” race as they devalued the Yuan overnight, much more than in previous moves. As countries strive to bolster their exports via currency devaluation, the U. S. is left with a strengthening dollar and lagging exports. Can the Fed really begin tightening in the face of these deflationary pressures? Stay tuned.
As for stocks, yesterday’s “bounce” was quickly erased in today’s session. By the close, the Dow Jones Industrial Average was down 212 points to finish the day at 17,402. The S&P 500 was down 20 points to close at 2084. Gold was up $4 to trade at $1108 per ounce, while oil was down $1.51 to trade at $43.45 per barrel WTI.
After last week’s downward motion, perhaps we are back to day to day gyrations. We’ll see if the mess in China continues to pressure markets overnight.
Have a nice evening everyone.