The Chinese stock market crash on Monday weighed on the U.S. market, causing stocks to open in the red. China’s Shanghai Composite plunged 8.5 percent in the final hours of trading, making it the largest decline in more than eight years.
More than two thirds of the Chinese stocks hit their down limit, basically wiping out all the gains made when the government stepped in to shore up previous losses. The losses bled over to Europe, where stocks there slid on the news and then on to the U.S. where the selling continued. The S&P 500 was dropping 1,293 points to 2,066 and is on track to lose all the gains for the month of July. The Dow Jones Index is down 150 points to 17,418, losing 1 percent of value in July and hitting its lowest level since February 3.
The one bright spot was gold, which was modestly higher as a safe haven against China worries. The last time the Chinese stock market had a record crash, The Peoples Bank of China “discovered” 600 tons of gold in order to prop up the market. No word yet if they’ve found any more gold. Gold was last up $5.90 to $1,091 an ounce.
There was good news on the U.S. economic front with durable goods orders up 3.4 percent in June, better than the analyst estimate of 3.2 percent. The more watched economic reports this week will be the consumer confidence report on Tuesday and the pending home sales report on Wednesday. The consumer confidence report is expected to drop, while the homes sales are expected to rise.
Nordstrom stock isn’t getting much lift from its decision to add more stores selling Madewell clothes. Madewell is a lower priced offering from J. Crew. And this partnership is the only place consumers can purchase the clothes outside of Madewell stores. Nordstrom introduced the clothes in 15 stores in the spring and is adding another 15. Nordstrom stock is down 54 cents to trade at $76.66.
Best Buy will begin selling the Apple Watch on August 7. It will be the first retailer outside the Apple store to sell the product. Apple wouldn’t say in its last earnings report how many watches it had sold, only that the sales exceeded expectations. The watch will be available in 100 stores to start and then an additional 200 stores will have the watch by holiday time. Best Buy will have 16 Watches and almost 50 accessories to sell.