The influence of China shares is very much alive in Wall Street as it fell in the red on Monday. Due to both concerns about China's slowing growth and in the wake of the biggest drop in Shanghai shares in 8 years, U.S. stocks are falling under immense pressure. Declining issues outnumbered advancing ones as The Dow Jones industrial average, Nasdaq and S&P 500 all fell to its lowest points after a long period of prosperity. Chinese shares fell more than 8% as an extraordinary government rescue plan to prop up valuations abruptly ran out. Fears of an impending crash are rising despite promises from China's top securities regulator that Beijing would continue to buy shares to stabilize the stock market.
Randy Frederick, managing director of trading and derivatives for Charles Schwab in Austin, Texas said that, "You still have a lot of shares that aren't allowed to be traded and a lot of things going on that is not allowing that (China) market to trade in a free, open and organic way," Unless restrictions are lifted, Frederick does not see the market stabilizing anytime soon.
U.S. business investment plans rebounded solidly in June. Teva Pharmaceutical's shares jumped 13.3% to a record high of $70.06 after it agreed to buy Allergan generic drugs business for $40.5 billion instead of purchasing Mylan. Allergan was up 6.8% while Mylan fell 13.2%. Investors are also watching economic data in light of this week's U.S. Federal Reserve's meeting, which could result in interest rate increases.
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