- Jim Young/Reuters
Stocks rallied a bit on Tuesday, even after the most important sector of the US economy grew at its slowest pace in 6 years.
First, the scoreboard:
Dow: 18,538.12, +46.16, (0.25%) S&P 500:2,186.48, +6.50, (0.30%) Nasdaq:5,275.91, +26.01, (0.50%) WTI crude oil: $44.88, $0.44, (+1.0%) 10-year yield: 1.537%, -0.060, (-3.73%)
The most important sector of the US economy grew at its slowest pace in 6 years. The monthly non-manufacturing purchasing manager’s index on the service sector came in at 51.4 for August. That’s the lowest reading since February 2010, when the index pulled out of contractionary territory for good following the Great Recession. And the US dollar tumbled after the data crossed. The US dollar index was down by 0.9% at 95.00 around noon ET. Saudi Arabia and Russia’s oil cooperation is a sign of “extreme economic duress,” and “in our view, increases the likelihood of some type of collective action if prices remain under significant pressure,” Helima Croft, the global head of commodity strategy at RBC Capital Markets, wrote in a note to clients. Larry Summers thinks Janet Yellen made a call that could tarnish her legacy at the Fed. “My second reason for disappointment in Jackson Hole was that Federal Reserve Board Chair Janet L. Yellen, while very thoughtful and analytic, was too complacent to conclude that ‘even if average interest rates remain lower than in the past, I believe that monetary policy will, under most conditions, be able to respond effectively.’ This statement may rank with former Fed chairman Ben Bernanke’s unfortunate observation that subprime problems would be easily contained,” he wrote in a Washington Post piece. The maker of EpiPen is being investigated for antitrust violations in New York. “A preliminary review by the Office of the Attorney General revealed that Mylan Pharmaceuticals may have inserted potentially anticompetitive terms into its EpiPen sales contracts with numerous local school systems,” New York Attorney General Eric Schneiderman’s office said in a statement.