Watch the Dots

By Nicholas Jasinski |  Tuesday, September 21 Shrug Off the Dip. U.S. stock indexes couldn't hold on to their morning bounce today, and closed with narrow losses. The S&P 500 and Dow Jones Industrial Average were each up close to 1% at their morning highs, coming after their largest one-day losses in months on Monday. But stocks wavered and slid through the day: the S&P finished down 0.1% and the Dow lost less than 0.2%. The Nasdaq Composite gave up most of a 0.9% gain to close just 0.2% higher on the day. Not exactly a convincingly bullish, "buy the dip" kind of day. The discussion of China Evergrande Group's looming default continued, with most experts playing down the potential risk to U.S. investors. Here's Barron's Jacob Sonenshine writing today: While there are several ways in which the Evergrande crisis could cause pain in the U.S. economy or financial markets, the U.S., at the very least, does not have a high degree of direct exposure to the problem. None of the major U.S. banks JPMorgan Chase, Citigroup, Bank of America, Goldman Sachs, and Morgan Stanley have more than 1.5% of their assets tied to Chinese cross-border deals, according to Wells Fargo analysts.  Still, 'It also has been our experience that risk flare-ups typically do not disappear overnight. We believe the capital market stress could take 1-2 weeks to wash through the system,' writes Christopher Harvey, head of equity strategy at Wells Fargo.   Uncertainty remains on several fronts, and there has been a lack of a single big directional driver for the market of late. That's been behind the choppy and sideways trading in recent weeks. The Delta wave's impact on companies' third-quarter results with earnings season less than a month away; the Evergrande situation; congressional wrangling over a debt-ceiling increase, the bipartisan infrastructure bill, and the government's next budget; and stretched stock valuations have all contributed to a sense of uncertainty in markets. Looming over all of it today is the Federal Reserve's next monetary policy decision, due tomorrow afternoon. More on that below.

 

DJIA: -0.15% to 33,919.84 S&P 500: -0.08% to 4,354.19 Nasdaq: +0.22% to 14,746.40 The Hot Stock: ConocoPhillips +4% The Biggest Loser: Las Vegas Sands -5.6% Best Sector: Energy +0.2% Worst Sector: Industrials -0.5%