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Global Wrap:
Current Futures: Dow -21.00, S&P -2.50, NASDAQ -8.00
European markets fell for the third straight day on Wednesday, as investors continue to question the current market’s valuation.
European markets are currently heading lower, extending the declines seen throughout the last few trading sessions. The banking and insurance sectors had the biggest drag on the European markets, with most financial institutions declining somewhere around 2-3%. On the other hand, drug makers continued to outperform the market in Wednesday trade, since these companies are usually seen as defensive stocks because drug maker profits are not correlated with the business cycle, meaning that companies have a better potential to earn profits through periods of economic downturn.
Spain, Luxembourg and Denmark were the worst performing markets in Europe, falling between 2-3%, with only a small number of companies still trading in the green. For example, in the Spanish index IBEX-35, only one company was trading above the break-even line, posting a 0.30% gain. At the same time, the emerging blue chip companies declined somewhere around 2.3%, while the more mature Western European markets declined as much as 1%.
Ahead, investors are preparing for the ADP report, which usually offers a good gauge for Friday’s NFP numbers. Markets are expecting a -250K read, which would be the lowest number for the current year. Later in the day, the FOMC minutes will be published at 14:00 EDT, being again a very important report for the market.
Overnight, the U.K. FTSE declined 31.54 points (0.65%) to 4,788.16, while the German Dax lost 49.74 points (0.93%) to 5,277.55.
Crude oil for October delivery was recently trading at $68.60 per barrel, higher by $0.50.
Gold for October delivery was recently trading lower by $0.30 to $956.20.