Soft economic data, Syria strikes hit US, European markets
NEW YORK — U.S. and European stocks mostly fell Tuesday following some disappointing economic reports and news that U.S.-led forces have started airstrikes against Islamic State militants in Syria.
KEEPING SCORE: The Dow Jones industrial average lost 25 points, or 0.2 percent, to 17,147 as of 9:57 a.m. Eastern. The Standard & Poor’s 500 index fell a point to 1,993 and the Nasdaq composite edged up two points to 4,529.
In Europe, the damage was far more noticeable. Germany’s DAX sank 1.1 percent, France’s CAC 40 lost 1.7 percent, and Britain’s FTSE 100 fell 1.5 percent.
EUROPE STAGNATING: The tone in global financial markets was negative. European stocks were hurt by a report that showed that the economy of the 18-country eurozone is failing to find any renewed momentum. In its monthly survey, financial information company Markit said its eurozone purchasing managers’ index, a closely watched gauge of business activity, fell to a nine-month low in September.
AIRSTRIKES IN SYRIA: Further weighing on investors’ sentiment was news that the U.S. and five Arab nations attacked the Islamic State group’s headquarters in eastern Syria in nighttime raids. Land- and sea-based U.S. aircraft as well as Tomahawk cruise missiles launched from two Navy ships in the Red Sea and the northern Persian Gulf were used.
ANALYST’S TAKE: “The escalation of the conflict will of course raise questions over the risk appetite of many within the markets, who are no doubt worried about a major war which appears to be unfolding,” said Joshua Mahoney, research analyst at Alpari.
UNHEALTHY: Health-care stocks were among the biggest decliners in the U.S. after the Treasury Department announced new regulations that would discourage corporate “inversions,” which are deals where a company merges with an overseas competitor to legally move its headquarters out of the U.S. to avoid U.S. taxes. Health-care companies have been among the most active in makings those kinds of deals.
Medtronic and Abbvie, both of which have been considering inversion deals, fell 2 percent in early trading.
CURRENCIES, ENERGY AND BONDS: The euro rose 0.3 percent at $1.2890 while the dollar fell 0.2 percent to 108.51 yen. In oil markets, a barrel of benchmark U.S. crude rose 33 cents to $91.20. U.S. government bond prices rose. The yield on the 10-year Treasury note fell to 2.55 percent.
