Tuesday morning news: December 25, 2018

Markets » AUDIO: [NYSE closing bell]

Saved by the bell, the closing bell on the New York Stock Exchange.

The markets shut down early yesterday for today’s Christmas holiday, and not a moment too soon.

The Dow Jones Industrial Average fell 3 percent and it’s now teetering on the brink of a bear market.

This marks the fifth time this month that the Dow has shed 2 percent or more in value.

The Standard & Poor’s 500 stock index fell prey to the bears on Monday, after the Nasdaq gave way on Friday.

A bear market means values more than 20 percent below recent highs.

Stocks fell for the fourth straight session. It’s the worst performance on Wall Street since the 2008 financial crisis.

Gus Faucher is chief economist for PNC financial services group. He says investors are concerned about the trade war and the global economy, interest rates, and now concerned about political stability in the United States.

But, despite the bear market, he sees no recession on the horizon.

FAUCHER: We’re still enjoying solid job growth and wage growth, consumers are still out purchasing, businesses are in good shape, so I think given the solid economic fundamentals that we have in the U.S., I think that the economy will continue to expand throughout 2019.

Faucher says even if the government shutdown goes for a week or two, he doesn’t expect it to have any effect on an otherwise strong economy.

Israel election failure » Israelis will go to the polls in April to choose a new government or give the current one a new lease on political life.

Prime Minister Benjamin Netanyahu called early elections yesterday after his governing coalition failed to pass a law that’s controversial with its coalition partners. Netanyahu has a tenuous hold on power in Israel’s parliament, the Knesset. He was expected to have to call elections in November after his defense minister resigned and pulled his ministers out of Netanyahu’s coalition, leaving him only a single-seat majority.

Complicating matters even further, Netanyahu faces possible corruption charges that could come any day now. He is President Trump’s most staunch ally and Netanyahu’s political trouble is likely to slow efforts to come to a peace agreement with the Palestinians.

Ginsburg » Supreme Court Justice Ruth Bader Ginsburg continues her recovery. On Friday, surgeons removed cancerous growths from her left lung. Doctors say there’s no evidence of disease elsewhere in her body, and they plan no further treatment. She’ll remain in the hospital for a few days.

Justice Ginsburg is 85 years old. She’s the oldest justice on the high court. But she may be its most resilient. From her hospital bed, Justice Ginsburg recently voted to block a presidential order from taking effect. It was President Trump’s ban on granting asylum to those who cross the U-S border illegally.

Ginsburg’s never missed oral arguments since she took the bench back in 1993.  Expectations are that she will be there when the High Court resumes work on January 7th.

Asia Bibi/Pakistan former PM sentenced » The former prime minister of Pakistan has been sentenced to seven years in prison for corruption. Nawaz Sharif is accused of possessing more assets than his income can explain.  He may appeal this verdict just as he did in another case in which he was sentenced to 10 years in July for his purchase of luxury apartments in London.

Meanwhile, Pakistani Christian Asia Bibi celebrates Christmas while she remains a prime target in her Muslim-majority country. This even though her death sentence for blasphemy was thrown out in October after being jailed since 2010.

Extremists call for her death and the government has set up armed forces to guard the Christian colonies.  Christians comprise about 2% of Pakistan’s population.

Fasi Zaka is a Pakistani political analyst:

ZAKI: As long as this drags out, it puts Pakistani Christians in a tenuous position. They are already significantly marginalized. They are not empowered. But this is a lighting rod issue that affects a whole community. 

The government has not revealed Bibi’s location out of fears for her safety. No word yet on her chances of gaining asylum abroad.

Indonesia » The search for victims of the latest tsunami to hit Indonesia continues. At least 370 are known dead with over a hundred people still missing and more than 1400 injured.

The tsunami struck with no warning. Although the wave was relatively small at about 3 ½ feet, it struck near the shoreline where many structures exist. Many people ask why there was no alert. Oceanographer Simon Boxall explains:

BOXALL: It would take thousands of detective buoys, which are difficult to maintain, expensive. Cost isn’t the only issue. It’s also a question of networking them to actually successfully detect a tsunami. And even then, you know, we’re still looking at a wave even in shallow water moving very rapidly and there’s very little time to do much about it. 

The nation sits along the Pacific Ring of Fire, an arc of volcanoes and fault lines in the Pacific Ocean.  It circles from Indonesia to Japan on the Asian side and along the western coasts of north and south America.  

(AP Photo/Seth Wenig) Traders work on the floor of the New York Stock Exchange on Monday, Dec. 24, 2018.

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