Stocks are slumping Tuesday as more caution creeps into financial markets worldwide.
The S&P 500 was 1% lower in early trading, following up on losses for stocks across Europe and much of Asia.
The Dow Jones Industrial Average was down 370 points, or 1%, at 35,102, as of 9:50 a.m. Eastern time, and the Nasdaq composite was 1.3% lower.
In the U.S., bank stocks dropped after Moodys cut the credit ratings for several smaller and midsized ones amid a long list of concerns about their financial strength.
Across the Pacific, stocks sank 1.8% in Hong Kong and 0.3% in Shanghai after a report showed exports for Chinas troubled economy shrank by the most since the start of the pandemic in 2020.
The worries layered on top of a mixed set of earnings reports from big U.S. companies.
UPS fell 3% after it cut its forecast for revenue this year. It reported stronger profit for the spring but weaker revenue.
Eli Lilly helped to limit the markets losses after jumping 16.4%.
The medicine developer reported profit and revenue for the spring that both topped analysts expectations.
More jolts may be ahead for markets.
The U.S. government later in the morning will report how many job opening were available across the country in June, a test of how resilient the job market remains.
Economists expect a separate report to show U.S. manufacturing continues to struggle under the weight of much higher interest rates.
The Federal Reserve has hiked its main interest rate to the highest level in more than two decades in hopes of grinding down inflation.
High rates work by slowing the entire economy bluntly, which has raised the risk of a recession but also helped inflation to moderate since its peak last summer.
Besides manufacturing, high rates have hit banks particularly hard. Moodys said the rapid rise in rates has led to conditions that hurt profits for the broad industry, while knocking down the value of investments made when rates were super low.
Such conditions helped cause three high-profile failures for three U.S. banks earlier in the spring, which shook confidence in the system.
Moodys also said troubles may be coming for banks with lots of commercial real estate loans, which are hurting as the threat of a U.S. recession remains and work-from-home trends keep people out of offices.
M&T Bank, one of the banks whose credit rating Moodys downgraded, fell 4.7%.
Truist Financial, one of the banks that Moodys said its reviewing for a possible downgrade, fell 4.5%.
Other, larger banks whose credit ratings weren’t affected also sank.
JPMorgan Chase fell 2% and was one of the heavier weights on the S&P 500.
Later this week, the U.S. government will releases data on consumer and wholesale inflation, which could influence what the Federal Reserve does next with interest rates.
The hope on Wall Street is that the cooldown in inflation since its peak above 9% last summer will help persuade the Fed that upward pressure on prices is under control and no more rate hikes are needed.
Forecasters expect Thursdays data to show consumer prices rose by 3.3% in July over a year ago, an acceleration from Junes 3%.
But some economists and investors say getting that list bit of inflation moderation to the Fed’s target of 2% is likely to be the most difficult.
They’re saying Wall Street has become convinced too quickly that the Fed can achieve a soft landing for the economy and that the 19.5% run for the S&:P 500 through the first seven months of this year was overdone.
In the bond market, Treasury yields tumbled as investors moved into investments considered safer.
The yield on the 10-year Treasury fell to 3.98% from 4.10% late Monday. It helps set rates for mortgages and other loans.
The two-year Treasury yield, which more closely tracks expectations for the Fed, fell to 4.73% from 4.79%.
Health minister Andrew Gwynne has been sacked over comments posted on a WhatsApp group.
Mr Gwynne reportedly made antisemitic comments and ‘joked’ about a pensioner constituent, saying he hoped she died before the next election, according to the Mail on Sunday.
In the WhatsApp chat, which contained Labour councillors, party officials and at least one other MP, Mr Gwynne made racist comments about Labour MP Dianne Abbott and sexist remarks about Deputy Prime Minister Angela Rayner.
A government spokesperson said: “The prime minister is determined to uphold high standards of conduct in public office and lead a government in the service of working people. He will not hesitate to take action against any minister who fails to meet these standards, as he has in this case.”
A Labour spokesperson confirmed Mr Gwynne had been suspended as a member of the Labour Party.
“We are investigating comments made in this WhatsApp group in line with the Labour Party’s rules and procedures,” they said. “Swift action will be taken if individuals are found to have breached the high standards expected of them as Labour Party members.”
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Mr Gwynne said he deeply regretted his “badly misjudged comments” and apologised for any offence caused.
“I’ve served the Labour Party all my life and it was a huge honour to be appointed a minister by Keir Starmer.
“I entirely understand the decisions the PM and the party have taken and, while very sad to have been suspended, will support them in any way I can.”
Nigel Huddleston MP, co-chairman of the Conservative Party, said there is “clear contempt for pensioners in the Labour Party”.
“This clearly goes beyond Andrew Gwynne and there is a rot in Labour that needs fixing. Andrew Gwynne should not remain a member of the Labour Party – they need to act.”
Hundreds of people have attended a march in memory of a 15-year-old boy stabbed to death at his school – ahead of a tribute by his football club, Sheffield United.
Dozens of people have left flowers and messages outside the school since his death.
Image: Harvey’s parents Mark and Caroline Willgoose
Image: Fans at Sheffield United’s match against Portsmouth held up a banner in Harvey’s memory
Harvey was an avid Sheffield United fan and football shirts, scarves and messages have been left for him outside the stadium in the city.
One message written on a Sheffield United shirt reads: “RIP Harvey. Forever in our hearts.”
Image: Pics: PA
Harvey’s friends joined Sheffield United supporters and others affected by his death at Sheffield Town Hall to march to the ground ahead of the match against Portsmouth at 3pm on Saturday.
One black and white banner with a picture of Harvey inside the Sheffield United logo read: “Lives not knives. It’s not OK.”
The march was supported by Sheffield anti-knife crime charity Always An Alternative.
At the game, play was stopped and applause broke out in the 15th minute, as fans and players paid tribute.
Fans also stopped for a similar tribute at West Bromwich Albion’s ground The Hawthorns for their game against Sheffield Wednesday.
Image: Portsmouth fans joined the march. Pics: PA
Earlier on Saturday churches in the city held services to commemorate the teenager.
Mark McManus, the parish priest at St Joseph’s church in Handsworth, Sheffield, said: “Harvey was a former pupil of St Joseph’s Academy and, along with the members of our community who attend All Saints High School, many will have been affected by his death – some very closely.”
A 15-year-old boy charged with murdering Harvey has been remanded into youth detention accommodation.
The defendant, who cannot be named because of his age, appeared at Sheffield Crown Court on Thursday charged with murder, possession of a bladed article and affray.
The parents of two of the girls murdered at a dance class in Southport have spoken of the moment they were told “something awful has happened” to their children.
In an interview with The Sunday Times, the parents of Bebe King and Elsie Dot Stancombe paid tribute to their daughters, while recalling what happened on 29 July 2024.
Warning: Some readers may find this article distressing
Describing the moment she dropped her daughter off at the two-hour workshop at Hart Space studio, Jenni Stancombe said she watched Elsie run inside, excited to show her friend her newly pierced ears.
“I watched her sit down and waved her off and I left her,” she said.
Just before midday, Ms Stancombe got a call from another mother, telling her: “Something awful has happened. Somebody’s stabbed the kids.
“I said, ‘What do you mean?'” Ms Stancombe said. “She went, ‘It’s really bad. You need to get here’.
“I just ran. I left the whole house open and got in the car.”
Bebe King’s parents – who cannot be named for legal reasons – had been busily preparing for a wedding the following day.
Her mother remembers being in Marks & Spencer when she received a phone call from her husband, who had arrived early to collect Bebe.
“I was about to put my card in the machine, and he called. ‘I can’t believe I’m telling you this but somebody has gone into the dance class with a knife’,” she said.
She ran outside and jumped into a taxi. The driver dropped her off at the end of the street – “and I just ran”.
Parents’ tributes to children
Bebe’s parents came up with her name after a trip to Hollywood, where they saw the blues guitarist BB King’s star on the Hollywood Walk of Fame.
Bebe King’s mother said of her daughter: “She would come out with the most random stuff. She would do it and look at you and laugh as if to say, ‘I’m dead funny, aren’t I?’ She would give you this hug and say, ‘I love you, momma’.
“She was the best. She was just … Me and her had our own little language. Sometimes we would just look at each other and know what each other was thinking.”
She said Bebe “had this innate kindness. She had a spark”.
Image: Alice Da Silva Aguiar also died at the dance class
Image: The last photo of Alice taken the day of the Taylor Swift dance class
Ms Stancombe said it was an honour to be Elsie’s mother. “Everything she did was pure enthusiasm. It could be the most boring thing – even, like, David taking the bins out – and it was like, ‘I’ll come!’ She was grateful for life.”
She described her daughter as “highly intelligent” but said she struggled with reading and writing. Leanne Lucas, who ran the dance workshop, had been Elsie’s private tutor for 18 months.
She had originally missed out on a spot at the dance workshop, which had quickly sold out. One of her school friends was going to the class and her mother messaged Ms Stancombe saying, “Have you got her a space?”
“And I was like, “Oh no’. I knew it had sold out, so I messaged Leanne saying, ‘Aw, I totally forgot to pay for Elsie’. And she messaged saying: ‘No problem. I’ll always have a place for Elsie.’ And she kept one. I just always think if she’d given it away…”
Image: The horse-drawn carriage that carried the coffin of Elsie Dot Stancombe waits outside St John’s Church in Birkdale.
Pic: PA
Rioting in Southport
The families were told to come off their social media accounts after riots broke out in Southport, and Elsie’s father and uncle Chris visited the wreckage of the riots the following day.
Neither wanted to comment on the rioting that followed their children’s deaths. Instead, both families paid tribute to the community that rallied around them in the wake of the tragedy.
“It’s about this community. It has brought light in the darkness, these little moments. And that’s what we’re constantly looking for right now.”
Image: Elsie’s funeral. Pic: PA
Bebe’s family spent the following week with her in a bereavement suite at Alder Hey Hospital in Liverpool. On the last day, her mother and father did a final bedtime routine, reading her Jack and the Beanstalk before they left.
No funeral director would accept money, while donations and support flooded in for the families.
Bebe had a white horse and carriage. “It’s not very us,” her parents told the Sunday Times while laughing, “but it was for her and we knew she would want that.”
Royal Family brought ‘genuine comfort’
The efforts of the Royal Family brought “genuine comfort” to both families, they told the Sunday Times.
Mr Stancombe said the visit by the Princess of Wales – her first public engagement since finishing chemotherapy – “meant a great deal to Jenni”.
Image: The Prince and Princess of Wales visited Southport. Pic: PA
“I won’t say what they said to us, but what they shared with us was really, really powerful, and it was a powerful message and heartfelt, and it meant a lot,” he said.
The families also met the King at Clarence House in August.
“We could see how much he cared,” Mr Stancombe said, laughing about the moment Elsie’s sister offered the King a biscuit.
Rudakubana also admitted trying to murder eight other children, as well as instructor Leanne Lucas and businessman John Hayes, on 29 July last year.
He was 17 years old when he walked into the dance studio, indiscriminately stabbing his victims with a 20cm blade he had bought on Amazon.
He was given 13 life sentences, with Mr Justice Goose saying the killings had caused “shock and revulsion” around the nation and said it was “highly likely” he would never be released.
During sentencing he was twice ordered out of the dock after trying to disrupt proceedings, by shouting that he “felt ill”.
The court heard emotional statements from victims and families, with Ms Lucas who was stabbed in the back, saying she couldn’t give herself “compassion or accept praise, as how can I live knowing I survived when children died?”.
The incident was not labelled a terror attack, although officers later found a plastic box containing the toxin ricin under his bed in the village of Banks, Lancashire, along with other weapons including a machete and arrows.
His devices revealed an obsession with violence, war and genocide, and he was found to be in possession of an al Qaeda training manual. It fell outside the definition of terrorism because police couldn’t identify the killer’s motive.
Families did not want sentencing televised
Neither family was in court when Rudakubana suddenly changed his plea to guilty.
Both families did not want the sentencing televised, while Bebe’s family believe details about her injuries went beyond what was necessary.
“The sentencing shouldn’t have been televised,” Elsie’s uncle Chris says. Bebe’s father agreed: “We know it has to be heard in court but why did the whole nation need to see it on television?”
Image: Post Office vans following the hearse carrying Elsie’s coffin. Pic: PA
Both talked about their struggle to adapt to a new life without their daughters. Mr Stancombe worked as a postman – he described how he would drop the post off at Elsie’s school and she would run over at lunchtime with her friends to say hello.
None of the parents have gone back to work yet, but Mr and Ms Stancombe have set up a charity – Elsie’s Story, to help other children in need.
This breaking news story is being updated and more details will be published shortly.