Monday Morning Links: Why Are Stock Futures Down Over 300 Points*? (January 4, 2016)

By | January 4, 2016

As we head into 2016 the economic news out of China leaves something to be desired!

And if China sneezes, does the rest of the world catch a cold?

Asian markets tumbled Monday on the first day of trading in 2016, with declines so steep in mainland China that authorities halted trading there for the rest of the day.

Analysts cited a number of reasons for the selling, including China’s disappointing manufacturing data, reported earlier Monday, and the coming removal of a ban on major shareholders from selling stakes, put in place during the summer stock crash…‘ (Source)

And this anecdotal evidence for a weakening economic trend in China is occurring in the face of the Federal Reserve tightening credit here in the United States (‘Fed Decision: It’s The Final Countdown (Video)‘).

The Fed move on monetary policy was executed despite the fact that, in a global economy, the ramifications could have negative implications for other countries who may be in a position where lowering rates is currently the monetary strategy of choice.

Add into the mix the spike in Middle East tension vis a vis Saudi Arabia and Iran and we have the ingredients for a Monday morning stock market selloff. What happens after that, as it always is, will be anyones guess!

[Bloomberg] China Stocks Head for Worst-Ever Start to Year on Growth Concern
[Bloomberg] Emerging Stocks Drop on China Data, Saudi Tension as Yuan Sinks
[Reuters] Dollar drops vs yen as geopolitical woes, China data sap risk appetite
[Bloomberg] Offshore Yuan Falls Most Since August as PBOC Seen Allowing Drop
[Bloomberg] Biggest Economies Face $7 Trillion Debt Refinancing Tab in 2016
[Reuters] Global ETF industry grabs record cash in 2015: BlackRock

Michael Haltman is President of Hallmark Abstract Service in New York. He can be reached at mhaltman@hallmarkabstractllc.com.

* As of 7:00AM EST

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