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Best Buy Co. Inc. (BBY)

Closing Price Change:
-$0.41
Closing Price:
$62.47
Market Cap:
$16,730m

US open: Dow jumps over 300 points as Wall Street rebounds from worst day since 2011

25 Aug 15

LONDON (ShareCast) - (ShareCast News) - US equities rebounded firmly early Tuesday, as Wall Street looked to bounce back from its worst day in four years.
Just after 1500 BST, the Dow Jones Industrial Average was up 332 points to 16,203.66, while the S&P 500 and the Nasdaq were 43 and 128 points higher respectively.

"After the market-wide panic of 'Black Monday', cooler heads seem to be prevailing this Tuesday morning, as investors begin to pick up the pieces, even if China itself continues to struggle," said Connor Campbell, financial analyst at Spreadex.

Chinese stocks plunge again

Chinese shares closed lower on Tuesday, although other stocks in the region began to rebound from "Black Monday".

The Shanghai Composite closed down 7.63%, despite the People's Bank of China injecting a $24bn boost to ease the pressure the index was under.

Meanwhile, the People's Bank of China cut interest rates for the fifth time since November in a bid to buoy its flagging economy.

The PBOC lowered its benchmark lending and deposit rates by 0.25 percentage point, adding that the rate cuts will become effective on 26 August and are aimed at reducing corporate borrowing costs.

China's central bank also reduced its reserve requirement ratio by 0.5 percentage points, starting from 6 September, adding the cuts are meant to ensure enough liquidity and stable credit growth.

"The fact that the PBOC can use the reserves requirement ratio cut as a buffer in this way underlines why recent concerns about the destabilising impact of capital outflows on China's economy are overdone," said Mark Williams, chief China economist at Capital Economics.

"The reserves requirement ratio of return for large banks still stands at 18.0% after this move."

Tuesday data

On the economic data front, the Markit composite Purchasing Managers Index declined slightly in August, figures released on Tuesday showed.

The index fell 0.7 points to 55.0, while the sub-index monitoring the services sector slid from 55.7 to 55.2, marginally ahead of expectations for a 55.1 reading.

US consumer confidence jumped from 90.9 to 101.5 in August, well ahead of expectations for a 93.4 reading, its second-highest reading since the recession.

"The rebound in this month's survey is reassuring given the recent volatility in financial markets and the sharp decline in confidence observed last month, which was driven in part by concerns over Chinese growth," Barclays' analysts said in a note.

"In addition, after a weak employment outlook last month, consumers were considerably more confident in the job market in August, giving us confidence in our positive employment outlook."

Meanwhile, according to the S&P Case-Shiller 20-city composite index, after seasonal adjustment prices declined 0.1%, while prices in June were up 5% year-on-year, little changed from May.

Sales of new single-family homes rose last month, recovering from the sharp decline they suffered the previous month.

According to figures released by the Commerce Department, new home sales rose 5.4% in July to a seasonally-adjusted annual rate of 507,000, after a 7.7% slump in the previous month.

Analysts had expected a 5.8% increase for a 510,000 annual rate last month, compared with a downwardly revised 481,000 rate in June.

In company news, Netflix jumped 8.10% after entering bear market territory on Monday, while Apple surged 5.25% after falling to a 10-month low in the previous session.

Best Buy soared 14.3% after its profit and sales beat estimates.

Elsewhere, European stocks recouped some of their losses, while the dollar fell 0.15% against the pound but rose 0.57% against the yen and 0.92% against the euro.

Gold futures slid 0.62% to $1,146.50, while oil prices staged a solid comeback, with West Texas Intermediate climbing 3.29% to $39.54 a barrel and Brent gaining 2.84% to $43.94 a barrel.

Note 1: Prices and trades are provided by Digital Look Corporate Solutions and are end of day values only.

 

Market Data

Currency US Dollars
52 Week High $91.93
52 Week Low $50.69
Shares Issued 267.80m
Market Cap $16,730m

Dividends

No dividends found