Market update: Investors remain subdued on US budget talks – 26.09.2013

Source: Henderson Global Investors

Overnight US equities posted losses for the fifth consecutive session (S&P 500 -0.3%, Dow Jones -0.4%, Nasdaq -0.2%) on the continuing budget negotiations. Wall Street trading has been somewhat directionless of late and economic data releases have failed to provide much inspiration to investors. US durable goods orders in August rose by 0.1% month-on-month and July’s change was revised down to -8.1%. Elsewhere, in August existing home sales increased slightly to an annualised rate of 421,000, compared with analyst expectations for a rise of 420,000. According to Bloomberg, September has been the biggest ever new issuance month for US corporate bonds. Yesterday mining giant BHP Billiton sold US$5bn of notes, its biggest debt raising in 18 months.

In Asia, the Hang Seng (-0.4%) and Shanghai Composite (-1.9%) fell but the Nikkei bucked the trend to finish up 1.2%. News is that Prime Minister Abe may shortly make an announcement regarding a corporate tax rate cut and other stimulus measures.

This morning European markets are lower. The FTSE Eurofirst 300 is down 0.2% while the FTSE 100 is down 0.1%.The UK economy expanded by 0.7% quarter-on-quarter, or 1.3% year-on-year in the second quarter of 2013 mainly driven by a stronger construction and industrials sector. The Office for National Statistics also revised growth for 2012 to 0.1%, down from the earlier estimate of 0.2%.