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Current Futures: Dow -18.00, S&P -2.90, NASDAQ -1.50
Most Asian markets are heading lower, following the poor momentum set during the U.S. trading hours. However, the Japanese index, the Nikkei, is holding slightly above the break-even line, one of the only major stock markets in the region that is still managing to post some gains.
In spite of the Nikkei’s performance, a report showed that Japanese retail sales tumbled for the 10th straight month, the worst performance since 2003. From one year earlier, Japanese retail sales are down 3% in June, even though the market expected a smaller decline, of -2.5%. In addition, on Thursday a report is expected to show that the Japanese industrial production is down 20% from a year earlier, which again denotes the magnitude of the economic slowdown since industrial production is one of the main industries in the Japanese economy.
With tonight’s declines, the Asian markets snapped an eleven-day old rally. Much of the declines came from the commodity sector, as crude oil and gold posted strong declines on Tuesday. In the Nikkei index, the securities sector was the worst performer, with each of its 9 companies declining. On the other hand, 11 out of the 12 companies in the precision instruments sub-sector advanced in the Japanese stock market tonight.
Overnight, the Japanese Nikkei added 17.65 points (0.17%) to 10,104.91. The Australian S&P/Asx declined 8.00 points (0.19%) to 4,161.50
Crude oil for August delivery was recently trading at $66.80 per barrel, lower by $0.50.
Gold for August delivery was recently trading lower by $0.30 to $941.40.
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