Tuesday’s Mid-Day Movers: 3 Stories Driving Markets
After flirting with negative territory early in the morning, the S&P and Dow pushed forward bravely, making gains by early afternoon and leaving the Nasdaq in the dust.
At 12:45 p.m.: DJIA: +0.30%, S&P 500: +0.16%, NASDAQ: -0.02%.
1) With the United States displaying just marginal economic improvement over the past few years, small businesses, which are the driving force behind the American economy, continue to suffer. The Small Business Optimism Index, published by the National Federation of Independent Business, increased just 0.90 points in January to 88.9. For some context, December’s reading of 88.0 was the second worst since March 2010.
Particularly troubling is the fact that the employment expectations component of the index continues to move at a painfully slow rate. Just 11 percent of small business owners reported adding new jobs over the past few months… (Read more.)
2) On Monday, gold logged its third consecutive day of losses and reached its lowest level in five weeks. The price movement is understandably concerning for any investors with holdings of the precious metal, but the actions of central banks around the world provide an interesting backdrop to the price consolidation.
Data compiled by Bloomberg shows that Russia, China, and Turkey were the world’s top buyers of Gold over the past decade, adding 570.1, 454.1, and 243.5 metrics tons, respectively to their stashes. Both Russia and China also hold significant reserves of American securities, and they have been critical about the status of the dollar as the world’s reserve currency… (Read more.)
3) Some investors think it’s about time, while others think it’s a foolish ploy, but the U.S. government will be taking McGraw-Hill (NYSE:MHP) to court because of the ratings that the company’s credit-rating agency Standard & Poor’s issued to securities before the financial crisis. Standard & Poor’s is accused of knowingly misrepresenting the quality of mortgage securities. The government is seeking up to $5 billion.
For its part, the company doesn’t seem to be too worried, refusing to settle and apparently confident that the government will be unable to prove intentional misconduct… (Read more.)