ORLANDO, Florida (Reuters) -TRADING DAY
Making sense of the forces driving global markets
By Jamie McGeever, Markets Columnist
U.S. stocks slid on Tuesday in a wave of profit-taking from the previous day's highs, as investors digested cautious remarks from Federal Reserve Chair Jerome Powell and data that showed U.S. business activity slowing for a second straight month.
In my column today I look at who is paying the record tariffs swelling U.S. Treasury coffers. So far, U.S. companies have taken the pain, but that burden is expected to shift to consumers. Will they be willing - or able - to "eat the tariffs"?
If you have more time to read, here are a few articles I recommend to help you make sense of what happened in markets today.
1. Fed's Powell: Repeats no risk-free path as Fed balancesjob, inflation risks 2. Full impact of U.S. tariff shock yet to come as growthholds up, OECD says 3. Trump scraps meeting with Democrats, raising governmentshutdown risk 4. More questions than answers in Nvidia's $100 billionOpenAI deal 5. U.S. Treasury's support for Argentina gives peso, Mileifriendly leg-up, for now
Today's Key Market Moves
* STOCKS: Taiwan hits new highs, China slips to 3-weeklow. Wall Street falls, Dow and Russell 2000 outperform. * SHARES/SECTORS: U.S. consumer discretionary, tech leadthe decline. Energy +1.7%. Oracle shares -4.4%, Nvidia -2.8%;biggest climber is Halliburton, +7.3%. * FX: Dollar remarkably stable vs G10 FX, but muchchoppier vs EM. Argentina peso +3%, Brazil's real +1%, India'srupee hits record low near 89/$. * BONDS: Treasury yields fall, as much as 3 bps at longend to bull flatten the curve. Two-year auction draws 2.51xbid/cover. * COMMODITIES: Gold hits new high $3,790/oz, platinum +4%to new 11-year high. Oil up around 2% on supply issues.
Today's Talking Points:
* U.S. government shutdown
It's that time of year again, when budget gridlock in Washington threatens to trigger a U.S. government shutdown and, in the worst case scenario for markets, some form of technical default. We are eight days away from what would be the 15th partial shutdown since 1981.
Uncertainty and volatility could ripple through markets until agreement on government funding is reached, which history shows is often at the 11th hour. Investors won't be getting complacent though, and on Tuesday President Donald Trump raised the stakes, scrapping a meeting with Democratic leaders. Eight days and counting.
* (Dis)United Nations?
The United Nations 80th General Assembly roared into life on Tuesday, with Trump center stage. In a 56-minute combative speech, Trump rejected the idea of a Palestinian state, urged Europe to pressure Russia to force an end to the war in Ukraine, and told leaders of nations he deems soft on immigration: "Your countries are going to hell."