US stocks plunged after reaching to highest since January point last two days. Investors were expecting just the opposite as there have been indicators like the credit rating upgrade from S&P. US ratings have been updated from negative to stable.
“The S&P upgrading of U.S. debt is certainly good in a sense that it takes the issue off the table,” Derek Sasveld, a New York-based senior portfolio manager for ING Investment Management U.S, said in a phone interview for Bloomberg.
Benchmark indexes slipped yesterday leaving S&P 500 and Dow Jones Industrial Average with 0.1% less value. Feds President of Saint Louis, James Bullard made an interesting statement yesterday assuring that inflation levels of less than 2% would definitely mean continuing bond purchasing in order to support growth and diminish unemployment level. Bullard suggested that inflation levels were surprisingly low and that could be seen as an opportunity to be aggressive with stimulus over a longer time-frame.
In corporate news, McDonalds added 1.27% due to better than expected sales for May. The company introduced new menu with two new items for the US customers – Egg White Delight and Chicken McWraps which boosted sales by 2.4%. Apple declined 0.7% after presenting a device called iTunes Radio at the companys annual developers conference. Monsanto Co. a biotechnology company raised shares by 4.5% as China accepted imports of the companys genetically modified Intacta soybeans. Facebook also jumped by 4.5% amid speculation the social network site would be included in S&P 500.
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