REUTERS
First, the scoreboard:
- Dow: 17,662.94 -332.78 (-1.85%)
- S&P 500: 2,044.17 -35.26 (-1.70%)
- Nasdaq: 4,859.79 -82.64 (-1.67%)
And now, the top stories on Tuesday:
- The euro plunged to a 12-year low against the US dollar. It fell below $ 1.07 for the first time since 2003 to as low as $ 1.0698. The market was focused on the European Central Bank’s quantitative easing program, which kicked off on Monday. With the US Federal Reserve expected to raise interest rates later this year, there is increased demand for the dollar. And according to Deutsche Bank, the Euro could reach parity with the dollar by the end of this year.
- European bond yields fell to record lows following the start of QE. Yields on 10-year notes in nearly a dozen countries including Germany fell to all-time lows.
- In US economic data, the NFIB Small Business Optimism Index inched up to 98.0 from 97.9 last month, missing the estimate of 98.9. The new Job Openings and Labor Turnover Survey report from the Bureau of Labor Statistics showed that US companies had 4.998 million job openings in January, slightly lower than the 5.050 million expected by economists. December’s number was revised down to 4.877 million from an earlier estimate of 5.028 million.
- In commodities, gold fell by up to $ 5 an ounce (or around 1%) on Tuesday after slumping by nearly 3% last Friday. According to Barclays, the strong jobs report increased bets that interest rates will rise soon; gold is a zero-yielding commodity and is in less demand when rates are seen to be rising. West Texas Intermediate crude oil fell as much as 2.6% to around $ 48.68 per barrel.
- Shares of Lumber Liquidators rallied by up to 11%, after influential short-seller Citron Research said in a note that the selloff may be “largely overdone.” The company’s shares fell more than 14% on Monday as several class action lawsuits emerged. The company’s laminate flooring was the subject of a CBS “60 Minutes” investigation broadcast March 1. Tests found that its flooring contained levels of formaldehyde, a potentially cancer-causing chemical, that breach regulatory standards. The company has said “60 Minutes” used an improper testing method, and will address the issue further during a conference call on Thursday.
- It’s now nearly impossible to profit from hoarding oil on a supertanker. As the price of Brent oil has rallied, this trade has become more expensive and virtually unprofitable, according to a Reuters report. The oil market has been in contango, meaning that futures prices are higher than expected spot prices, and so it pays to store oil for later delivery. American crude oil is still piling in storage for the most part.
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