Markets fall with Japan stocks in bear territory; Berkshire’s cash hoard at record high

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Markets fall with Japan stocks in bear territory; Berkshire’s cash hoard at record high

Traders work on the floor of the New York Stock Exchange during afternoon trading on August 02, 2024 in New York City. 

Michael M. Santiago | Getty Images

This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.

What you need to know today

Jobs shock hits stocksU.S. stocks

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after a weaker-than-expected

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added to fears of a recession. The

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shed 1.84% while the

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 retreated 1.51%. The

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dropped 2.43% and is now in correction territory, having declined more than 10% from its recent high. Treasury yields

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, with the

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hitting its lowest level since December 2023. The odds of a 50-basis point cut to the Federal Reserve’s benchmark rate stand at 78.5% from 22% before the nonfarm payrolls data, according to the

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. 

****** stocks plunge  ****** stocks

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on Monday, with the ********* market confirming a bear market. The

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and Topix dropped over 12% and more than 20% below last month’s all-time highs. The

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fell 8.1% before trading was halted, while Taiwan’s

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dropped ove

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8%. ******** stocks bucked the regional trend as the CSI 300 index edged higher. China unveiled a plan over the weekend to boost consumer spending, while

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published on Monday showed a pickup in services. The

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strengthened to 142.56 to the dollar. 

Buffett’s billions

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‘s second-quarter results showed a

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as Warren Buffett

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. Berkshire held a record $276.9 billion in cash at the end of last quarter, up from the previous high of $189 billion in the first three months of 2014. Berkshire has been a net seller of stocks over the past seven quarters. Operating earnings from Berkshire’s fully owned businesses rose 15% from last year to $11.6 billion.

Exxon beats, Chevron misses

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‘s

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to $9.2 billion from a year ago, beating consensus as it achieved record production in Guyana and the Permian Basin in the southwestern part of the U.S. But

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missed expectations, with

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to $4.43 billion. Chevron reported a sharp fall in U.S. refining margins and said it was shifting its headquarters from San Ramon, California, to Houston, Texas.

[PRO] Earnings boostCNBC Pro identified

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after they report results this week. The stocks had to pass several criteria, including receiving five or more earnings upgrades in the past three months.

The bottom line

Will Japan’s monetary policy shift hurt U.S. stocks?

Russell Napier, a financial historian, argued that it will,

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— whereby investors borrow in a low interest rate currency like the yen to invest in assets that will likely generate higher returns.

“The now evident vulnerability of U.S. equity prices to a rise in the yen exchange rate warns of the consequences for U.S. asset prices and developed-world asset prices in general from monetary policy changes in the east,” Napier wrote in a report last week.

The Bank of Japan

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from its previous range of 0% to 0.1%, narrowing the rate differential with the U.S. Federal Reserve that had pressured the yen. BOJ also outlined plans to taper its bond buying program in a sign that it was prepared to let ********* interest rates rise further.

The

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has rallied strongly since falling to a 38-year low of 161.96 to the dollar on July 3. The ********* currency was trading at 143.1 on Monday afternoon in Asia.

The sharp reversal in financial market sentiment has triggered

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to their lowest in more than a year, providing some relief to homeowners and builders of residential property.

According to

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, the average 30-year fixed mortgage rate declined by 22 basis points to 6.4% on Friday. This marks the lowest rate since April 2023. The 15-year fixed mortgage rate dropped to 5.89%, its best level since early May 2023. 

— CNBC’s Sam Meredith and Diana Olick contributed to this report.

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#Markets #fall #Japan #stocks #bear #territory #Berkshires #cash #hoard #record #high

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