Stocks slid to session lows after analysts at Goldman Sachs recommended that clients set up short positions in the S&P 500. The analysts set a short target for the benchmark index at 1285, about 4% lower than current levels, writing that Thursday’s soft U.S. reports “provides further evidence that weakness has extended into June.”
Energy and materials stocks led all 10 of the S&P 500’s sectors lower after reports showed that business activity in the euro zone and manufacturing activity in China each contracted in June.
The Dow had rallied 6.1% from June 4 through the session before the Fed’s policy decision, largely on hopes for stimulus measures.
European markets turned lower after the weak U.S. data. The Stoxx Europe 600 fell -0.5% and broke four-day winning streak. Most Asian stock markets fell on worries about the Chinese economy after the gauge of China’s manufacturing activity showed more weakness.
Thomas Doherty is an undergraduate at Villanova University majoring in Finance and Economics. Thomas@KeeneOnTheMarket.com