U.S. Stocks Limp Along

U.S. stocks hobbled along midday Wednesday on hopes that the European Central Bank will hammer out a debt-buying scheme for its cash-starved economies.

Grim August manufacturing, combined with dismal Chinese production and reduced factory activity have buffeted bourses worldwide. The downswing sparked hopes the ECB will somehow reign in wincingly high borrowing costs and the Federal Reserve will implement additional stimulus measures.

The Dow Jones Industrial Average edged up 5.30 points to 13,041.24. Investors traded up in anticipation of ECB President Mario Draghi’s debt address, Thursday.

Draghi may waive bond seniority status, for example. This would entice investors to buy Spanish and Italian debt (and reduce interest rates) because it would put them on an equal footing in the event the euro zone restructured its debt.

The S&P 500 and NASDAQ Composite lost ground, as some investors feared the workings of the monetary powers that be, namely the ECB and Fed, have already been priced in to the equation.

Markets were further tempered as the shipping titan FedEx reduced its growth and earnings forecast due to “weakness in the global economy.” Its shares were down almost 1% this morning.

Another critical test will come Friday when the Bureau of Labor Statistics releases the August Jobs Report. Economists predict unemployment, too, will stagnate at 8.3%

The dollar ratcheted up to $1.26 against the euro, pressuring down the price of gold.

Facebook’s (FB) stock popped nearly 5% to $18.57 per share after founder Mark Zuckerberg pledged not to sell his stock for another year. This announcement came after trading closed Tuesday.

Nokia (NOK) shares plummeted 13%. Investors in the phone company were besmirched after the Finnish company unveiled its latest smartphone, the Lumia 920, at a press conference in New York, and failed to provide price and carrier details, along with an exact date the product will go on sale.

 

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