STOCKS once again succumbed to late-day selling in light trading yesterday as hopes China’s newfound dedication to yuan flexibility turned to doubts about the speed and magnitude of Beijing’s intentions.
The market’s overall bearish tone eroded the initial optimism around the benefits of the yuan move. Stocks pulled back as investors questioned the effectiveness of what is expected to be a gradual change.
The S&P 500 briefly broke above 1,130, the midpoint between its 2010 high and low and
a key technical mark, but was unable to hold the level, adding to the negative sentiment. The index had risen more than eight per cent over the past ten trading days.
Losses were extended on Nasdaq on weakness in large-cap tech stocks. Amazon.com fell
2.6 per cent to $122.55 after it cut the price of its Kindle e-reader product to $189 from $259. Google lost 2.3 per cent to $488.56 and Dow component Microsoft was down 1.9 per cent to $25.95.