Dow climbs in early Friday action as Wall Street attempts to cap tumultuous trading week with an upswing


Stock benchmarks on Friday rose modestly higher as investors looked to close out a volatile, holiday-shortened week that has the tech-heavy Nasdaq Composite on track for its biggest weekly loss since the height of the pandemic-induced market selloff in March.

How are major benchmarks trading?

The Dow Jones Industrial Average
DJIA,
+0.19%

rose 117 points, or 0.4%, to around 27,650, while the S&P 500
SPX,
+0.07%

gained 14 points, or 0.4%, to trade at 3,353. The Nasdaq Composite Index
COMP,
-0.09%

climbed 48 points, or 0.5%, at 10,952. But all three benchmarks were trading off their intraday peak near the open, highlighting the week’s choppy action.

The Dow on Thursday fell 405.89 points, or 1.5%, to close at 27,534.58, while the S&P 500 ended with a loss of 59.77 points, or 1.8%, at 3,339.19. The Nasdaq Composite fell 221.97 points, or 2%, to finish at 10,919.59. Through Thursday, the Dow was down 2.1% for the week, while the S&P 500 was off 2.6% and the Nasdaq was 3.5% lower; markets were closed Monday for Labor Day.

What’s driving the market?

A decline in the S&P 500 index for the week would mark the benchmark’s first back-to-back weekly drop since May.

“While monetary policy is set to remain supportive for several more quarters, valuations are high across assets and volatility is resurfacing,” said Elia Lattuga, co-head of strategy research at UniCredit Bank, in a note. “The breadth of the rally is still limited and the recovery uneven—hence developments in the economic outlook and political risks represent significant threats to risk appetite.”

Stocks were unable to follow through Thursday on a Wednesday bounce that saw equities recover somewhat from a three-day, tech-led rout that pushed the Nasdaq into correction territory, falling more than 10% from its record close set last week.

Weakness on Thursday was partly tied to the inability of U.S. politicians to agree on a new coronavirus rescue package after Democrats blocked a Republican bill on the Senate floor, leaving the way forward unclear, analysts said.

Meanwhile, investors have fretted that the sharp rally that took stocks from their March pandemic lows to new all-time highs had left valuations significantly stretched for the large-cap, tech-related stocks that had led the rally this year. Among those highfliers, shares of Apple Inc.
AAPL,
-0.85%

 and Netflix Inc.
NFLX,
+1.22%

 were on track for weekly declines of more than 6%, while Facebook Inc.
FB,
-0.57%

 is off more than 5%.

In U.S. economic news, the consumer-price index for August rose 0.4% last month, beating average economists’ estimates for a rise of 0.3% but falling below the past two months at 0.6%. On a year-over-year basis, the CPI increased 1.3% after gaining 1.0% in July, the Labor Department said on Friday

Looking ahead, Federal budget figures for August are due at 2 p.m. Eastern.

Which companies are in focus?
What are other markets doing?

The yield on the 10-year Treasury note
TMUBMUSD10Y,
0.675%

 rose 0.4 basis point to 0.687%. Bond prices move inversely to yields.

The ICE U.S. Dollar Index
DXY,
-0.12%
,
which tracks the performance of the greenback against its major rivals, fell 0.1%.

Gold futures
GCZ20,
-0.08%

were off 0.3% at $1,958 an ounce, threatening to snap a three-day winning streak. The U.S. crude oil benchmark
CL.1,
-0.10%

 fell 16 cents, or 0.5%, to $37.13 a barrel.

The Stoxx Europe 600 index
SXXP,
-0.11%

 was edging 0.1% lower, while the U.K.’s benchmark FTSE
UKX,
-0.26%

rose 0.2%. In Asia, Hong Kong’s Hang Seng Index
HSI,
+0.78%

and the Shanghai Composite Index
SHCOMP,
+0.78%

 both rose 0.8%, while Japan’s Nikkei
NIK,
+0.73%

rose 0.7%.



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Here’s what could trigger more stock market pullbacks this year, says Schwab trading pro


A record-setting August for stocks has set the bar high, and September looks off to a promising start, at least for technology stocks, with electric-car maker Tesla
TSLA,
+12.56%

poised for more big gains.

That brings us to our call of the day from Schwab Center for Financial Research’s vice president of trading and derivatives, Randy Frederick, who thinks the stock market may finally deliver on some much-needed corrections.

“Obviously these things are difficult to pinpoint, but a 2%-3% decline sometime in the next couple of weeks wouldn’t be at all surprising to me. I continue to believe that the SPX
SPX,
-0.21%

[S&P 500] can reach 3,700 (+14.5%) by year-end, but probably not without three or four small pullbacks along the way,” he told MarketWatch in an interview and follow-up email.

“We haven’t had anything of that nature at all since going all the way back to early June, when we had that big drop-off. We’re clearly way overdue on that,” Frederick said. And while 3,700 sounds “pretty remarkable from a bottom-of-the-virus return,” on a year-to-date basis that 14% gain for the S&P 500 is fairly average, he noted.

When those smallish pullbacks come along, though, he advises against panic (he urged no panic in early March too), saying “they will be and should be used as buying opportunities.” That is because there is nowhere else for investors to put their money as any Federal Reserve interest rate increase is years out, said Frederick. And investors should learn from those who panicked out of the market in 2008 and missed out on an 11-year bull market, he added.

One potential correction trigger is technical, as he says 2020 has been closely tracking the action in 2009. That year saw three pullbacks — 3.5%, 4.3% and 5.6% in the last few months of 2009 — as his chart shows:

A “substantial pullback in earnings could also trigger a pullback,” he said, noting that second-quarter S&P 500 earnings per share came in far better than expected.

Frederick is watching the coronavirus pandemic as a potential trigger, with schools opening across the country and the potential for a dramatic uptick in the case count spooking markets, while trade issues with China shouldn’t be dismissed, as they also have the power to unhinge markets.

Another stick of dynamite for stocks is continued wrangling over enhanced unemployment benefits in the U.S. “That’s a big issue that needs to be resolved on what they should do to support workers and small business going forward,” said Frederick.

Read: Investors may be betting the wrong way on the U.S. election, says JP Morgan

The market

Nasdaq-100
NQ00,
+0.81%

futures are tearing higher, with Dow
YM00,
-0.10%
,
S&P
ES00,
+0.18%

futures up modestly. European stocks
SXXP,
+0.12%

are mixed, with the euro
EURUSD,
+0.42%

at a two-year dollar high. Gold
GC00,
+0.93%

and oil
CL.1,
+1.17%

are up, and Asian stocks were mixed.

The buzz

Tesla’s premarket climb has been slowed by news it will sell up to $5 billion worth of its stock. Also, an analyst said the electric-car maker is “fundamentally overvalued.”

Shares of Zoom
ZM,
+8.63%

are surging, after the videoconferencing group soundly beat forecasts. Companies paid up for the service.

Apple
AAPL,
+3.39%

reportedly ordered 75 million 5G iPhones, and shares are up.

Retailer Walmart
WMT,
-1.03%

is launching a $98 a year membership program offering fuel discounts and free shipping, to perhaps rival Amazon Prime
AMZN,
+1.44%
.

An update on manufacturing from U.S. purchasing managers, construction spending and automobile sales are ahead. China delivered stronger-than-expected manufacturing numbers.

President Donald Trump has defended his decision to visit Kenosha, Wis., on Tuesday, and offered up a defense of the teenager who shot two protesters. Democratic rival Joe Biden accused him of making things worse. A shooting in Los Angeles late on Monday has also drawn protesters.

Random reads

“I wish we had more time” — actor Michael B. Jordan’s moving tribute to late co-star Chadwick Boseman.

Belarusian opposition leader says protesters are vanishing.

Don’t miss the Corn Moon.

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Buffett’s Berkshire Takes Stakes in Japanese Trading Companies By Bloomberg


© Bloomberg. Warren Buffett Photographer: Andrew Harrer/Bloomberg

(Bloomberg) — Warren Buffett’s Berkshire Hathaway Inc . (NYSE:) took stakes in five Japanese trading companies, expanding its reach abroad.

Buffett’s company announced Sunday night that it acquired “slightly more” than 5% of the shares of Itochu Corp., Marubeni Corp., Mitsubishi Corp., Mitsui & Co. and Sumitomo Corp., according to a statement. The purchases, made through one of its insurers, National Indemnity, are valued at more than $6 billion, according to Bloomberg calculations.

The move marks a big push abroad by Buffett’s firm, which has long accumulated stakes in U.S. companies including Apple Inc (NASDAQ:). and Coca-Cola (NYSE:) Co. Berkshire has also sought investments abroad with holdings in China’s BYD Co (OTC:). through its energy business and Brazilian payment company StoneCo Ltd.

“I am delighted to have Berkshire Hathaway participate in the future of Japan and the five companies we have chosen for investment,” Buffett said in the statement. “The five major trading companies have many joint ventures throughout the world and are likely to have more of these partnerships. I hope that in the future there may be opportunities of mutual benefit.”

Shares of the trading companies surged after the announcement, with Sumitomo climbing as much as 8.9% on Monday morning in Tokyo.

Berkshire plans to hold the Japan investments for the long term and has pledged to only hold as much as 9.9% of the shares in any of the five companies, unless given specific approval by the investee firm’s board of directors, according to the statement.

©2020 Bloomberg L.P.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.





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Buffett’s Berkshire buys 5% stake each in five Japanese trading firms By Reuters


© Reuters. FILE PHOTO: Berkshire Hathaway Chairman Warren Buffett walks through the exhibit hall as shareholders gather to hear from the billionaire investor at Berkshire Hathaway Inc’s annual shareholder meeting in Omaha

(Reuters) – Warren Buffett’s Berkshire Hathaway (N:) said on Sunday it has acquired more than 5% stakes in each of the five leading Japanese trading companies.

Berkshire Hathaway’s wholly-owned subsidiary, National Indemnity Company, will notify Japan’s Kanto Local Finance Bureau of the purchase of the stakes in Itochu Corp (T:), Marubeni Corp (T:), Mitsubishi Corp (T:), Mitsui & Co Ltd (T:) and Sumitomo Corp (T:), the company said in a statement.

Berkshire Hathaway intends to hold its Japanese investments for the long term, but may increase its holdings up to a maximum of 9.9% in any of the five investments depending on price, the company said.

“The five major trading companies have many joint ventures throughout the world and are likely to have more of these partnerships. I hope that in the future there may be opportunities of mutual benefit,” Buffett said.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.





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New Zealand exchange halts trading for 4th straight day after multiple cyberattacks


New Zealand’s NZX exchange has been targeted by DDoS attacks four days this week.


Getty Images

New Zealand’s stock exchange halted trading for a fourth day in a row Friday due to multiple cyberattacks.

“We are currently experiencing connectivity issues which appear similar to those caused by severe DDoS attacks from offshore this week,” Wellington-based exchange operator NZX Ltd.
NZX,
-2.95%

said in a statement. NZX’s website was down as well. DDoS, or distributed denial-of-service, attacks overwhelm a targeted server or network with traffic.

ZDNet.com reported a global criminal syndicate is behind the attacks, which are part of a global campaign to extort bitcoin from some of the world’s largest financial and e-commerce companies. PayPal
PYPL,
+0.42%

and its Venmo service have also been targeted, ZDNet said, along with MoneyGram
MGI,
-0.32%
,
YesBank India, Worldpay and Braintree.

The hackers are reportedly the same as those identified by Akamai Technologies Inc.
AKAM,
+1.49%

in an alert earlier this week, who are sending ransom letters demanding bitcoin to companies in the U.S., U.K. and Asia-Pacific region. The hackers reportedly claim to be from the  Armada Collective and Fancy Bear groups, but it is believed they are not actually affiliated with those notorious hacker organizations.

NZX is working with its internet service provider, as well as cybersecurity partners and New Zealand’s national security bureau, the New Zealand Herald reported.

The repeated interruptions in service have raised serious concerns about the exchange’s security, and raised fears that the cyberattacks could be the prelude to moves against larger global exchanges.

Professor Dave Parry of Auckland University of Technology’s department of computer science told New Zealand news service Newshub that it was “a very serious attack on critical infrastructure in New Zealand,” and “indicates a level of sophistication and determination which is relatively rare.”

Before trading was stopped, New Zealand’s NZX-50 index
NZ50GR,
+0.33%

was closing in on its all-time record high of 12,073.34, set in February.

Separately, a DDoS-bitcoin extortion scheme at Tesla Inc.’s
TSLA,
+3.97%

Nevada gigafactory was apparently thwarted by the FBI earlier this month, and a Russian national arrested in the scheme.



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