Post-Labor Day Worries Stifle Markets
$1 Escalating tension with North Korea put U.S. markets on alert. Russia’s Vladimir Putin forecasted “global catastrophe” if the U.S. continued provocations against the republic. The U.S. pushed the UN and China to come out against the country as it reportedly readies another missile test. Reports of a successful hydrogen bomb test during the Labor Day weekend put international markets on edge and sparked urgency in the U.S.
$2 Jeff Sessions announced the administration’s intent to end the DACA program. Subsequently, nationwide reactions and protests broke out. Democratic and GOP representatives commented favorably on DACA, in a rebuke of the move. Economists estimate recruitment costs for employers to reach up to $6B if all “Dreamers” are expelled.
$3 Inflation reports came in low, weighing on bond markets. 10-year treasury yields have fallen 30 basis points over the past quarter, sinking to 2017 lows. Decreasing yield hurts banks. The banking sector fell over 2% today. Should Congress manage to iron out major fiscal issues (debt ceiling, budget, taxes) during the August session, rebounds are likely. Until then, big banks are down big.
That’s all for now.