EPA Warns Carmakers in Volkswagon's Wake

Gold Levels Out as Markets Enter Correction

The price of gold has finally leveled off as markets find themselves on unsure footing. The NASDAQ is in full correction mode, down nearly 10% over the past 3 months, and the uncertainty in the marketplace has been good for the price of gold.

The commodity price of a troy ounce of gold has risen just over 2% this trailing month, from just under $1,125 to over $1,150. Gold is traditionally a port in the storm when the stock market is falling, but it has been on a steep decline recently. Over the past year, gold is down 5.49%.

Biotech Collapse Drives NASDAQ Down

The Health Services sector has plummeted this past week, as shares of nearly every major biotech company have posted massive losses.
The NASDAQ, which is made up of quite a few biotech firms, has paid the price with 5 straight days of losses -- even as other indexes post gains. The problem seems to be mostly one of public sentiment, with investors bailing on the companies as they catch flack for their pricing models which many people have seen as unfair.

The fall in biotech was really kicked off by a single investor, who bought a company and then raised the price of their treatment. That caused presidential contender Hillary Clinton to speak out publicly and denounce pricing in the biotech sector. The resulting backlash has helped to drive share prices to near-record lows.

Petrobras Down Big in Brazilian Bribery Scandal

State-run Brazilian oil company Petrobras shook shareholders recently when it was uncovered that the company had spent over $2 billion just in bribes. The discovery has resulted in a number of lawsuits, most prominently one by the Bill and Melinda Gates Foundation. The charity alleges that they wouldn’t have invested money with Petrobras if they had known of the scope and scale of their corruption.

The oil giant is also facing allegations that it lied about its balance sheet. Petrobras share prices are suffering from this latest news. They’ve fallen from highs of around $8 to just under $1.70.

EPA Warns Carmakers

The EPA has put the entire auto industry on notice that it would be looking for cheaters, after the recent scandal with Volkswagon (VLKAY). It appears as though Volkswagon cheated EPA tests on purpose with specialized devices that were installed in hundreds of thousands of cars. Now the EPA is paying even closer attention to emissions testing, and actively looking for deception.

The warning went out on Tuesday that the EPA would be looking for cheaters, according to sources within a major auto manufacturer. They are beginning the process of testing every model of diesel-powered car, truck, and SUV currently on the roads. This audit will pay special attention to the sorts of cheating that was recently uncovered.

Home Sales on the Upswing

According to a recent report, sales of new homes were up by over 500,000 units last month. In fact, August was the best month for new home sales since early 2008. Still, the figure is a long way from the historical average of just over 700,000, but the number is an encouraging sign for the housing sector.

Part of the reason that home sales are doing so well, at least compared to previous months, is the fact that mortgage rates are near all-time lows. The average 30-year fixed note for August was as low as 3.90%, where historically rates have been between 5% - 7%. The reason behind these cheaper interest rates is the Fed, which has kept the prime rate pegged at 0% since 2008.
Published on Sep 26, 2015
By Aaron Phillips
Aaron Phillips is a financial researcher and journalist based out of Michigan. He regularly writes the IG Daily and IG Weekly columns.

Copyrighted 2016. Content published with author's permission.

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