scorecard
  1. Home
  2. stock market
  3. Markets Slide After Yellen Warns Some 'Valuations Appear Stretched'

Markets Slide After Yellen Warns Some 'Valuations Appear Stretched'

Myles Udland   

Markets Slide After Yellen Warns Some 'Valuations Appear Stretched'
Stock Market1 min read

Markets are mixed amid a busy day that has Federal Reserve Chair Janet Yellen speaking to lawmakers on Capitol Hill and U.S. June retail sales that were mixed.

The Dow is up 17 points, the S&P 500 is flat, and the Nasdaq is down 11 points.

Janet Yellen is delivering her semiannual monetary policy report before the Senate Banking Committee, followed by a Q&A with lawmakers.

Among Yellen's notable comments were her assertion that "significant" slack remains in the labor market.

Yellen also said that, "The Committee recognizes that low interest rates may provide incentives for some investors to 'reach for yield,' and those actions could increase vulnerabilities in the financial system to adverse events."

"While prices of real estate, equities, and corporate bonds have risen appreciably and valuation metrics have increased, they remain generally in line with historical norms," she added. "In some sectors, such as lower-rated corporate debt, valuations appear stretched and issuance has been brisk."

Earlier this morning, June retail sales came in below expectations, though last month's report was revised up. The headline retail sales number showed sales grew 0.2% over May, and grew 0.4% excluding autos and gas.

The report comes on the heels of some negative commentary from retailers to start earnings season last week.

Also in economic data, the July Empire Manufacturing report came in at 25.60, stronger than the 17.0 reading expected by economists. This number is also better than the 19.28 that was reported in June.

Tobacco giants Reynolds American and Lorillard also announced a $27.4 billion deal to merge, a proposed deal that would create a more formidable number two tobacco rival to Altria Group.

Also in the industrial chemical space, Albermarle and Rockwood Holdings announced a $6.2 billion deal to merge.

READ MORE ARTICLES ON


Advertisement

Advertisement