LONDON -- Stock markets will remain closed in the U.S. today as Hurricane Sandy storms up the East Coast. An original plan to allow only electronic trading has also been abandoned; there will be no equity trading in the U.S. on Monday, and markets may remain closed on Tuesday. Despite this, limited trading in futures markets was taking place, and at 7 a.m. EDT both the Dow Jones Industrial Average (INDEX: ^DJI) and the S&P 500 (INDEX: ^GSPC) were lower by approximately 0.6%.
Forecasters say Hurricane Sandy may be the biggest storm ever to hit the U.S. It is expected to make landfall in southern New Jersey on Monday night. Early this morning, Sandy was producing sustained winds of 85 mph, according to the National Hurricane Center. Officials fear that a 10-foot tidal surge could follow Sandy's landfall, causing severe damage and flooding. As many as 10 million people are expected to lose electricity, and widespread damage to property is likely throughout the Northeast.
Today will be the first unscheduled closure of the markets since the terrorist attacks of September 2011 and the first weather-related closure since Jan.8, 1996, when 20 inches of snow fell on New York, delaying the opening of the markets. The last time markets were completely closed due to bad weather was during Hurricane Gloria in 1985.
Today's economic calendar
Despite the closure of the markets, Federal economic data will be released on schedule. Today's calendar includes personal-income and consumer spending data for September, both of which are expected to show modest rises on the previous month.
Many corporate earnings releases will also proceed as normal today, albeit with some notable exceptions. Pfizer has postponed its release, as has power firm Entergy. According to Reuters, other firms are also expected to postpone their releases until markets reopen. Among those scheduled to release results today are Anadarko Petroleum, Burger King, PG&E, Herbalife, and Baidu.
European markets
In Europe, markets faded after opening and were showing modest losses by 7 a.m. EDT. Pressure is growing on Europe's official-sector lenders (governments) to take a haircut on Greek debt, something German Finance Minister Wolfgang Schaeuble described on German radio as having "little to do with reality," despite appearances to the contrary and growing pressure from the IMF. In Italy, former Prime Minister Silvio Berlusconi has threatened to withdraw his party's support from Italy's coalition government to force a premature general election, raising concerns that bond yields could rise.
Due to the closure of the U.S. markets, trading in Europe was expected to be quieter than usual. At 7 a.m. EDT, the DAX was down 0.6%, the CAC was down 0.9%, the FTSE MIB was down 1.6%, and the IBEX was down 0.8%. In London, the FTSE 100 was down 0.6%, with banking and insurance shares trading lower, along with miners. Anglo American was down 2.2% following a broker downgrade and news that it has reached a tentative deal with unions to rehire 12,000 dismissed workers at its South African platinum mines.
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