Market Minute: Chinese Stocks Plunge by Most in 4 Years

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More declines are in store on Wall Street after Chinese stocks suffer their biggest loss in nearly four years.

The Dow Industrials (^DJI) tumbled 270 points, or 1.8 percent last week, the Nasdaq (^IXIC) slid 1.9 percent and the S&P 500 (^GSPC) lost more two percent. The major averages have now lost ground in four of the past five weeks.

Chinese stocks plunged 5.3 percent overnight on fears of a liquidity crisis squeezing the banking sector and leading to weaker economic growth. The stock market losses in China also rippled across Europe today.
Chinese stocks plunge by most in 4 years
AP PhotoAn investor speaks to another at a private securities company Tuesday, June 4, 2013, in Shanghai, China.

In a speech tomorrow, President Obama is expected to call for the regulation of emissions from existing power plants. That could require costly fixes for the utilities that own coal-fired plants. Utility stocks have been under pressure for another reason -- rising interest rates, which tend to reduce demand for companies that pay rich dividends.

One merger of note this morning: Tenet Healthcare (THC) has agreed to buy Vanguard Health Systems (VHS) for $1.8 billion dollars, plus the assumption of debt. On a per share basis, that's a 70 percent premium to Friday's closing price.

Shares of Apple (AAPL) could be under pressure again. The brokerage firm Jefferies (JEF) lowered its target price on the stock to 405 a share. Apple closed on Friday at 413.

Monsanto (MON) now says sabotage was the most likely cause of the genetically modified wheat found in Oregon last month. A company official says the tainted wheat was found only in one isolated area of a farm, and not dispersed throughout the crop.

Walt Disney's (DIS) "Monsters University" prequel topped the weekend box office, taking in $82 million dollars in its debut. The movie is from Disney's Pixar unit, which still has a perfect record: All 14 of its movies have been number one during their debut weekends.

And Starbucks' (SBUX) price hikes take effect tomorrow for brewed coffee, latte and espresso drinks. The average increase is about one percent, and only at certain locations.

-Produced by Drew Trachtenberg

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ole.obamy.failedagain

OBAMY ECONOMY=="BENGHAZI"~!"SPYING"~"BENGHAZI"~"SPYING"

June 24 2013 at 2:41 PM Report abuse -1 rate up rate down Reply
AL CONFER

Ross Perot staed many years ago that NAFTA was going to destroy America and the working man in America. NAFTA only allows jobs to be exported to any country that can do the job cheaper. Used to be Japan, not it is China and our Congress does nothing because they have so called blind trusts and they are not so blind. Congress is making millions and we allow China to get away with stealing American jobs. We need FAIR trade, NOT FREE trade.

June 24 2013 at 1:56 PM Report abuse +1 rate up rate down Reply
William

The economy is going to tank again. Stagnant economy but stocks higher? And obie is creating more regs? Prices go up. The dems must go. The libs must disappear. The constitution must be upheld. Conservatives made this country, the dems are tearing it down.

June 24 2013 at 1:40 PM Report abuse rate up rate down Reply
WILLS

If anyone has not noticed, the markets are HIGHLY reactionary and ANYTHING that is first thought to be either GOOD OR BAD results in large movement of money. China is slowing? Their banks are tightening the belt? This was known two months ago - it is not NEWS.
The Fed MAY cut back it's QE programs? Does anyone really expect this to go on forever? Besides, they SAID "MAY", given certain conditions and as those conditions do not appear to be anywhere on the current horizon, it's the statous quo.
When everyone gets done fretting the stock market will return to an upward motion as at present, the U.S. still remains the best investment.
It's the best looking house on a block of ugly ones.

June 24 2013 at 1:21 PM Report abuse +2 rate up rate down Reply
ectullis

In any event Hussein must go.

June 24 2013 at 1:20 PM Report abuse +3 rate up rate down Reply
tmlbtb

Anyone ever wonder how Wallstreet kept breaking records in a bad economy? Could it have been all on speculating, money on paper? Again the house of cards is crumbling. Poor management, quick 1/4'y profits. No susbstance of any kind. The money managers are running a legal casino on Wallstreet, where only the biggest spenders and losers reside.

June 24 2013 at 1:05 PM Report abuse +3 rate up rate down Reply
pdbliz

I do not trust either side...............GOVERMENT IS CORRUPT............

June 24 2013 at 12:26 PM Report abuse rate up rate down Reply
plewdawg

I have to laugh. For several weeks the moronic progressives have said how great the economy is and jobs on the rise. How "Happy Days Are Here Again." Even as many warned them it was a smoke and mirror show. Oh, how the progressives used their usual vile and hateful comments. Well, my little dearies, in the words of Reverend Wright, "The chickens have come home to roost!" BTW: It is going to get a hell of a lot worse.

June 24 2013 at 12:20 PM Report abuse +2 rate up rate down Reply
2 replies to plewdawg's comment
pdbliz

,,,SUPER POST.!!!!!!!!!!!!!1 HOW TRUE IT IS.!!!!!!!!!!

THE WORSE HAS NOT ARRIVED YET,,,,,BUT,,,IT IS COMING SOON...

June 24 2013 at 12:24 PM Report abuse +1 rate up rate down Reply
rademps

The sky is falling, the sky is falling! I predict that there will be a fallback. And there will be a recovery, and a fallback, and a recovery. and on and on. Why blame it on the "progressives" (demonizing people who don't agree with your politics)? It is the economic cycle that happens in all countries. I also get upset about the GOP "just saying no" but demonizing stupidity doesn't change anything. The United States has, among other problems, two that could be fixed with little effort on the part of Congress. It is not news that old and overused bridges are collapsing and it is a problem that is not going to go away. There are over 600 thousand bridges in the country with an average ago of 42 years that the American Society of Civil Engineers give a grade of C+ to. President Obama’s request for $50 billion to repair roads and bridges was dismissed by Republicans as an unfunded wish list. (We could use $150 billion.) The government could borrow that money now at the lowest interest rate in history, around 1%, to fund reconstruction and put thousands of unemployed back to work in the process. Or we can let them remain unemployed and bridges collapse until we can do the same work at more expense. Hardly an issue created by progressives.

June 24 2013 at 12:42 PM Report abuse +1 rate up rate down Reply
dago&betty

They heard that OBAMA,was coming home ,to CHINA.??????????

June 24 2013 at 11:40 AM Report abuse +6 rate up rate down Reply
SPQR

The DOW will slide 3000 points this week !!!!

June 24 2013 at 11:31 AM Report abuse +4 rate up rate down Reply
1 reply to SPQR's comment
rademps

Jeez, there are so many experts on the economy here. I wonder if any are in agreement with the Kondratieff Long Wave Cycle. I have a graduate degree in economics but I admit to being a bit rusty on the ISLM model. I wish someone would explain how the monetary and fiscal policies are interactive. Do any feel the Laffer Curve is so much BS?

June 24 2013 at 12:49 PM Report abuse -2 rate up rate down Reply