BY THE NUMBERS
Global stock markets tumbled Monday, with Dow futures' decline of nearly 700 points, or nearly 2%, leading the way lower in the United States. A number of emerging investment risks led to the widespread selling. (CNBC)
* Hong Kong's Hang Seng Index dropped more than 3% overnight on concern about a possible market contagion stemming from embattled Chinese property developer Evergrande Group, which is teetering on bankruptcy. European stocks also sank as Wall Street followed.
* Investors were already concerned about the seasonably rough month of September and the historical trend of the back half of the month being especially weak. The Dow Jones Industrial Average, the S&P 500 and the Nasdaq fell Friday and for all of last week.
* The Federal Reserve's two-day September policy meeting, which starts Tuesday, is also a wild card for markets. Central bankers are considering when to begin tapering bond purchases against a backdrop of elevated inflation and a recovering economy. Fed Chairman Jerome Powell has maintained that rising prices pressures will be temporary.
With Evergrande on the brink of collapse, analyst are warning the potential fallout could have far-reaching implications beyond China. After expanding rapidly for years and snapping up assets as China's economy boomed, Evergrande is now snowed under a crushing debt of $300 billion. Evergrande said its escalating troubles could lead to broader default risks. (CNBC)
U.S. Treasury Secretary Janet Yellen issued another plea to Congress to raise the federal debt ceiling. In a Wall Street Journal op-ed Sunday, Yellen said failure to do so would lead to a first-ever U.S. default and compound the damage from the Covid pandemic. Yellen said last week that the Treasury would exhaust its emergency efforts to make payments on debt already incurred sometime in October.
The intersection of all these worrisome factors led investors to sell stocks and risk assets and buy bonds. The 10-year Treasury yield, which moves inversely to price, dropped Monday to around 1.31%. U.S. oil prices fell 2% on Monday. (CNBC)
Bitcoin, which has seen some recent strength after a summer sell-off to below $30,000, dropped 9% on Monday. The world's biggest cryptocurrency traded around $43,165 in early trading. It hit an all-time high over $64,000 in April. (CNBC)
IN THE NEWS TODAY
Pfizer (PFE) and BioNTech (BNTX) said Monday their Covid vaccine is safe and generates a "robust" immune response in a clinical trial of kids 5 to 11. The companies tested a two-shot regimen of about a third the dosage used for adolescents and adults administered three weeks apart. Pfizer and BioNTech will submit their findings to the FDA and other U.S. regulators "as soon as possible." The New York Times reported vaccinations for the younger kids could begin as soon as Halloween. (CNBC)
The FDA is expected to issue a decision sometime this week on which groups are eligible to get a third dose, or booster shot, of the Pfizer's Covid vaccine. An FDA advisory committee Friday unanimously recommended Pfizer booster shots for people 65 and older and other vulnerable Americans. The panel voted against boosters for the general public at this time. Pfizer and BioNTech shares were lower in Monday's premarket downdraft. (CNBC)
* Dr. Fauci defends FDA panel, says it didn't make a mistake (CNBC)
U.S. border agents began expelling plane-loads of mostly Haitian migrants from a large makeshift camp they had set up after wading across the Rio Grande separating Mexico and the United States, with repatriation flights arriving in Haiti on Sunday. Migrants were still continuing to cross the river over the weekend despite heightened security on the U.S. side. (Reuters)
* Senate parliamentarian deals blow to Democrats' immigration push (AP)
SpaceX returned its Crew Dragon spacecraft from orbit on Saturday, with the capsule carrying the four members of the Inspiration4 mission back to Earth after three days in space. Crew Dragon capsule Resilience splashed down off the coast of Cape Canaveral, Florida in the Atlantic Ocean. (CNBC)
* Elon Musk mocks Biden after SpaceX completes first all-civilian mission (CNBC)
STOCKS TO WATCH
Bank stocks, including JPMorgan (JPM), Bank of America (BAC) and Citigroup (C) slid in Monday's premarket as bond yields slide on slowdown fears. Big bank stocks took a hit as the falling rates may crimp profits. BofA and JPMorgan were each down more than 2%. Citigroup declined 2.5%.
Colgate-Palmolive (CL) was upgraded to buy from hold by Deutsche Bank on Sunday. The investment firm said that Colgate's difficulties with inflation and in some international markets was already priced in to its stock.
AstraZeneca (AZN) announced Monday that its breast cancer drug Enhertu showed positive results in a phase-three trial. Shares of the company were up more than 1% in premarket trading.
Cathie Wood's ARK Innovation ETF (ARKK) was down 2.75% in the premarket, on pace to snap a three-day winning streak. Compugen, DraftKings, Coinbase and Square were also among the biggest ETF losers in early trading.
Netflix's (NFLX) "The Crown" was the big winner at Sunday's Primetime Emmy Awards, bringing home seven wins, the most of any show. Apple TV+ (AAPL) earned four awards for "Ted Lasso." Host Cedric the Entertainer opened the night with a karaoke rendition of "Just a Friend" by Biz Markie, aided by Rita Wilson, LL Cool J and Lil Dicky. (CNBC)