Fed, JPMorgan Worries, Weigh on Stocks
NEW YORK (TheStreet) -- Major U.S. stock markets were slipping Monday driven by worries over the wider implications for companies exposed to China amid the regulatory scrutiny of JPMorgan Chase's (JPM) business practices in the country and uncertainty over the timing of the Federal Reserve's tapering process.
JPMorgan shares declined 2.7% to $51.83. The Securities and Exchange Commission's anti-bribery unit has opened an investigation into the practices of JPMorgan Chase in China, The New York Times reported. The Times, citing a confidential U.S. government document, said the inquiry centered on whether the bank had hired the children of Chinese officials to help it gain business in China.
"I think it's [the market] kind of in a malaise right now waiting for those Fed minutes, to anticipate when tapering may begin," said Joe Heider, regional managing principal for Rehmann Financial Group, which manages $2.2 billion.Elsewhere, Cliffs Natural Resources (CLF) was the biggest loser in the S&P 500, tumbling 4.8% to $21.74. Morgan Stanley analysts remain bearish on the iron-ore miner stock, pointing to eroding pricing power in the Great Lakes market, increasing pricing pressure and rising cost struggles. Apache (APA) was another prominent loser, down 4.6% to $75.37 after the energy stock was downgraded at Stifel Nicolaus to "hold" from "buy" due to its sizable exposure to Egypt, where there's been escalating social unrest. Petroleo Brasileiro Petrobras ( PBR) shed 2.1% to $14.13 after the Brazilian oil giant's announcement of the sale of $2.1 billion in oil and gas, petrochemical and power plant assets left equity analysts underwhelmed. The U.S. economic calendar was empty Monday. Investors this week were awaiting the release of the Federal Open Market Committee minutes Wednesday from its July meeting for more guidance into the pace of and when Fed tapering will begin. Clues will also be sought from any developments out of the Aug. 22-24 meeting of central bank officials in Jackson Hole, Wyo. The 10-year Treasury was another indicator of the broad-based Fed jitters. The benchmark 10-year Treasury was plunging 15/32, pushing the yield up to fresh two-year highs of 2.882%. Follow @atwtse -- Written by Andrea Tse and Joe Deaux in New York >To contact the writer of this article, click here: Andrea Tse.>
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