Stocks slip off record highs
Swiss lender Credit Suisse announces $4.7B writedown
U.S. equity markets slipped off record highs Tuesday as investors continue to weigh the possibility that Congress approves both President Biden’s $2.3 trillion infrastructure package and tax hikes.
The Dow Jones Industrial Average fell 97 points, or 0.29%, while the S&P 500 declined 0.10% and the Nasdaq Composite was flat. Both the Dow and the S&P 500 finished at record highs on Monday.
Biden said on Monday that he wasn’t worried about higher taxes hurting the economy. However, Sen. Joe Manchin, D-W.Va., a key swing vote, expressed concern that raising the corporate tax rate to 28% from 21% would hurt American competitiveness.
On the economic front, U.S. job openings rose in February to the highest level since January 2019.
In stocks, Swiss lender Credit Suisse Group AG announced a $4.7 billion writedown and said it would lose $960.4 million in the first quarter due to the fallout from the unwinding of positions owned by the hedge fund Archegos Capital Management. The company also announced two executives would immediately step down from their positions.
Block trades made by Credit Suisse tied to the Archegos saga are weighing on shares of ViacomCBS Inc., Vipshop Holdings Ltd. and Farfetch Ltd, according to Reuters.
Elsewhere, biotechnology company Illumina Inc. guided current-quarter and full-year revenue above Wall Street estimates.
Meanwhile, energy producer Phillips 66 Co. warned its loss for the current quarter would be larger-than-expected due to the winter storm that snarled operations in the U.S. Gulf Coast region in February.
In commodities, West Texas Intermediate crude oil jumped $1.04 to $59.69 per barrel and gold rallied $9 to $1,737.80 per ounce.
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European markets were higher across the board with Britain’s FTSE 100 trading up 1.28%, Germany’s DAX 30 rising 0.98% and France’s CAC 30 advancing 0.5%.
In Asia, Japan’s Nikkei 225 slid 1.3% and China’s Shanghai Composite slipped 0.04% while Hong Kong’s Hang Seng climbed 1.97%.