(News Bulletin 247) – Wall Street lost ground on Tuesday as several US regional banks were placed on negative watch by Moody’s. The Dow Jones thus fell by more than 0.4% to 35,314 points and the Nasdaq Composite, by 0.8% to 13,884 points.

Following in the footsteps of Fitch, which had downgraded its rating assigned to US debt last week, Moody’s pinned Monday evening the vulnerability of several mid-sized banks, such as BNY-Mellon or US Bancorp.

The rating agency highlighted the pressures these banks face in terms of funding, but also insufficient capital reserves from a regulatory point of view and the risk associated with their exposure to commercial real estate.

In another cause for concern, China’s exports fell for the third consecutive month in July, by 14.5% year-on-year (their biggest drop since July 2020), while its imports contracted by 12.4% .

“These worse-than-expected data underscore that the world’s second-largest economy is being dragged down by both weak global demand and a domestic slowdown,” Deutsche Bank said.

Still on the economic chapter, the Commerce Department announced a reduction in the United States trade deficit to 65.5 billion dollars in June, as well as a reduction in inventories of American wholesalers of 0.5% on same month.

Investors also took note of a new series of quarterly company results, acclaiming in particular those of Eli Lilly (+14.9%) which raised on this occasion its forecasts for the current financial year.

They also saw positively the results of Paramount Global (+1.6%) -accompanied by the announcement of the sale of its publishing house Simon & Schuster-, but reserved a less warm welcome for those of UPS (- 0.9%).

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