Stocks markets managed to recover from a huge sell-off and closed mixed amid worries over the global impact from a slowing Chinese economy reduced the demand for risky assets, and attracted investors to buy much safer U.S. government bonds. Amont other stocks, a particular noticeable underperformance could be noticed among blue chips, which fell on the back of a decline of Boeing (BA) and some losses in the financial sector. Nevertheless, the Nasdaq Composite managed to post a very small gain, finally breaking a four-day losing streak. In addition, the S&P 500 closed in green.
The recent Chinese default send global equities lower, together with some not very optimistic forecasts for further negative results on retail sales and industrial production. Right after a bearish Chinese trade results, a slowdown in the world’s second largest economy will have a huge effect on Europe, unnerving investors across the globe, boosted also by a four-year low in copper prices, which is considered a barometer to Chinese manufacturing activity.
Among corporate news, New Jersey’s attempt to prohibit direct sales of vehicles continued to affect Tesla (TSLA)’s stock, while investors turned bearish on General Motors (GM) following allegations from the Department of Justice that the company may have broken the law by ignoring an ignition defect for more than 10 years. In addition, shares of Fannie Mae (FNMA) and Freddie Mac (FMCC) dropped amid a decision by the Senate Banking Committee to break down the mortgage lenders operated by the government.
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