United States close: Stocks end lower despite Bannon departure

Lucy Hill
August 21, 2017

Former Goldman Sachs President Gary Cohn, who serves as the director of President Donald Trump's National Economic Council, is under growing pressure to quit after Trump's moral equivocation on Tuesday between Nazis and the leftwingers who came to stop the Nazis in Charlottesville, Virginia.

"We had yesterday's Fed minutes that certainly didn't do the dollar any favors", said Omer Esiner, chief market analyst at Commonwealth Foreign Exchange in Washington.

"The dollar, for the most part, remains in a state of directionless confusion, supported on the one hand by resurgent US economic data yet burdened by the expanding White House rat's nest".

While the losses were small, Friday marked the first time stocks have not risen the day after a more than 1 percent drop since Trump was elected president a year ago.

Cohn is considered among the more moderate voices in Trump's White House. The attack follows the one in Barcelona on Thursday where suspected Islamist militant drove a van into crowds, killing 13 people and wounding scores of others.

By the close of trading, the Dow was down 274 points, a loss of 1.24 per cent.

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The US dollar fell 0.55 per cent against the yen to 109.60 yen and 0.4 per cent against the Swiss franc.

On the data front, USA consumer sentiment rebounded in early August from an eight-month low in July, reflecting confidence in the economic outlook and personal finances. Sterling edged 0.1 percent lower to $1.12874 against the dollar and is set for its biggest weekly drop since June 11. The dollar slipped to a four-month low against the yen in the early trading hours but rebounded some of it losses after rumours regarding firing of White House senior adviser Steve Bannon.

The Nasdaq Composite was down 45.32 points, or 0.71 percent, at 6,299.79. The Canadian dollar was trading at C$1.2575 to the greenback, or 79.45 USA cents, up 0.8 percent.

The speculation about Cohn's potential departure sunk the Dow to its lowest point in three months, CNBC reported, but assurances from the White House that the NEC chair will stay have apparently soothed concerns.

The 10-year Treasury yield was 2.197 percent, unchanged from on Thursday and marginally higher on the week.

Dollar sales against the yen accelerated also because the Japanese currency increased its safe-haven appeal following the Barcelona attack, for which the Islamic State militant group has claimed responsibility.

Other reports by TheDailyFarc

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