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Business/Finance See other Business/Finance Articles Title: Apple Phones, Failing Loans, Fed, China: What Drives Markets Next? Apple Phones, Failing Loans, Fed, China: What Drives Markets Next? Mike Larson | Monday, September 14, 2015 at 4:20 pm It’s a Super Bowl week in the markets, with so much on the line ahead of the Federal Reserve meeting. But between now and then, we’re seeing an interesting battle shaping up for the markets. On the one hand, you have Apple Inc. (AAPL) claiming it generated strong pre-orders for its new iPhone 6S models. The phones don’t actually ship until Sept. 25. But Apple said it’s on pace to top the 10-million-unit rate of initial weekend sales for its original iPhone 6 and 6 Plus models. The company rolled the 6S models out last week at a San Francisco event, and many analysts (myself included) seemed underwhelmed. An upgraded camera, “3D touch” screen technology, and a few other features didn’t seem to excite many people beyond the devoted faithful. It’s worth noting that Apple always uses breathtaking and over-the-top language to describe its product features and market response, and that it didn’t provide any concrete sales figures this time. So we really won’t know how the new phones performed until Apple’s next quarterly report. Will the uncertainty with Chinese stocks move markets this week? Or will one of the multitude of other events be the catalyst? Meanwhile, Chinese stocks rolled over again last night after we got ugly economic data there. Growth of so-called “fixed asset” investment in things like real estate sank to its lowest level in 15 years, while production growth missed forecasts. We also saw fresh lows in select Asian currencies and Turkey. Most importantly: The Bank for International Settlements (BIS) warned that emerging-market turmoil, a huge increase in global debt loads, rising loan defaults, and an end to the multi-year period of artificially suppressed interest rates could trigger a major financial crisis. The BIS is the “central bank for central banks” so its words carry a significant amount of weight. The organization said China, Brazil and other major emerging markets may soon have banking and bad loan crises to deal with, on top of stock market and currency declines, and sovereign debt downgrades. All of this suggests we still have significant worries about lousy overseas growth, tighter monetary conditions in the currency and bond markets and tumbling foreign stocks, Fed meeting or no Fed meeting. And we still have a few companies that are trying to buck the trend. “We still have significant worries about lousy overseas growth.” Will the bearish forces building overseas win this fight? Or will a handful of bullish companies give investors a reason to stick around? I’ve explained why I’m more worried about downside risk than missing some rip-roaring upside rally. But I’m interested in your take. Share it right away at the Money and Markets website because we don’t have much time before the Fed gathers for its fateful meeting. Post Comment Private Reply Ignore Thread
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