Dow falls 59 as late-day gloom kills a rally
The selling offsets decent earnings from Cisco Systems and Home Depot. Techs fall, led by Microsoft and Intel. Michael Kors rises. Gold and oil slip. The major averages have fallen more than 6.6% since mid-September.
(Reuters) Stocks fell back in late trading today as continuing worries about the effects of the fiscal cliff on the domestic economy pulled the major averages lower and offset strong earnings from Home Depot (HD).
Cisco Systems (CSCO) shares were up 7.4% after hours to $18.12. Fiscal-first quarter earnings of 48 cents a share were up 11.6% from a year ago and beat Street estimates by 2 cents. Revenue was up 6% to $11.9 billion, beating the Street estimate of $11.8 billion.
But it was the kind of sell-off you don't like to see. The Dow Jones industrials ($INDU) were up as many as 83 points on the Home Depot news -- and lost all of the gain and then some. Financial and technology shares led the market lower. Also weighing on the market: a rising dollar against the euro, which pushed commodity prices and interest rates lower.
Microsoft (MSFT), down 90 cents to $28.14, weighed heavily on technology stocks after the company announced that Steven Sinofsky, who led the development of its Windows 8 operating system, is leaving the company. Sinofsky had been considered a front runner to succeed Steve Ballmer as CEO. (Microsoft is the publisher of MSN Money.)
The Dow fell 59 points to 12,756, its fourth loss in five sessions. The Standard & Poor's 500 Index ($INX) was off 5.5 points to 1,375, its third loss in the last five days. The Nasdaq Composite Index ($COMPX) dropped 20 points to 2,884, its fourth loss in five sessions.
The Nasdaq-100 Index ($NDX), heavily influenced by Apple (AAPL) fell 21 points to 2,562. Apple was up 7 cents to $542.90.
Futures trading suggests a decent open for stocks on Wednesday, much like today. The big question will be if a rally will hold.
| Energy prices -- New York close | ||||||||||||
| Tues. | Mon. | Month chg. | YTD chg. | |||||||||
| Crude oil (-CL) | $85.38 | $85.57 | -1.00% | -13.61% | ||||||||
| (per barrel) | ||||||||||||
| Heating oil (-HO) | $2.9608 | $2.9992 | -3.31% | 1.60% | ||||||||
| (per gallon) | ||||||||||||
| Natural gas (-NG) | $3.7390 | $3.5700 | 1.27% | 25.09% | ||||||||
| (per mil. BTU) | ||||||||||||
| Unleaded gasoline (-RB) | $2.6538 | $2.6763 | 0.89% | -0.14% | ||||||||
| (per gallon) | ||||||||||||
| Brent crude | $108.26 | $109.07 | -1.04% | 0.82% | ||||||||
| (per barrel) | ||||||||||||
| Retail gasoline | $3.4400 | $3.4370 | -2.30% | 5.01% | ||||||||
| (per gallon; AAA) | ||||||||||||
The Dow has fallen 6.2% since peaking at 13,597 on Sept. 20. The S&P 500 has fallen 6.2% since peaking at 1,466 on Sept. 14. The Nasdaq has drooped 9.4% since its Sept. 14 high. Apple has fallen $22.7% since peaking on Sept. 19.
The pullback has trimmed the Dow's gain for the year to 4.4%. The S&P 500 is still up 9.3%, while the Nasdaq is up 10.7%. It had been up 22% for the year as of Sept. 14.
Intel (INTC) continued to sag on worries about the future of personal computers, hitting a new 52-week low of $20.18 before closing at $20.28, down 48 cents. Rival Advanced Micro Devices (AMD) said it has hired J.P. Morgan to look at strategic alternatives. An outright sale, however, doesn't seem likely.
Home Depot led the Dow and was the second-best performer among S&P 500 stocks (after Advanced Micro Devices), rising $2.22 to $63.38. The retailer reported earnings that beat expectations and raised its outlook.
Shares of TJX Cos (TJX) shot up $1.09 to $42.06 after the operator of the Marshalls and T.J. Maxx discount chains said its quarterly profit beat Street estimates by a penny a share. The S&P Retail Sector Index ($RLX) rose 6.3 points to 643.
Energy stocks finished lower as crude oil in New York settled down 19 cents to $85.38. Brent crude, traded in London, was off 88 cents to $108.19 a barrel. Gold (-GC) fell $6.90
was also lower in New York.
Technology shares came under pressure after Microsoft announced the departure of Sinofsky. Microsoft shares slid 90 cents to $27.09.
The euro debt crisis and the fiscal cliff weigh on markets
The market was held back in part by the continuing euro zone debt crisis. There were also those concerns about the "fiscal cliff" in the United States, and the debt crisis in the euro zone.
The fiscal cliff is a series of budget cuts and tax hikes that begin to take effect in the new year. Market participants worry that if no deal is reached to avoid going over the cliff, the economy could fall back into recession.
The Dow is down 2.6% this month, with the S&P 500 is 2.7%. The Nasdaq is off 3.1%.
Concerns over the fiscal cliff contributed to the Dow's and S&P 500's worst week since early June last week, with no sign of a bottom despite a drop of almost 3% over the past two weeks.
"The attention in the equity markets has shifted more noticeably to the possibility that the U.S. fails to properly handle the so-called fiscal cliff," Ari Wald, an analyst at PrinceRidge Group, told Reuters.
Wald said equities in developed countries have been outperforming U.S. stocks despite worries about the euro zone's financial health.
In other earnings news, AK Steel (AKS) shares fell 96 cents to $4.50 after forecasting a fourth-quarter loss.
But shares of Michael Kors Holdings (KORS) gained 43 cents to $51.01 after the fashion designer's company raised its outlook.
Charley Blaine contributed to this report.
| Short hits from the markets -- New York close | ||||||||||||
| Tues. | Mon. | Month chg. | YTD chg. | |||||||||
| Treasury yields | ||||||||||||
| 13-week Treasury bill | 0.0900% | 0.090% | -18.18% | 800.00% | ||||||||
| 5-year Treasury note | 0.620% | 0.643% | -13.29% | -25.30% | ||||||||
| 10-year Treasury note | 1.589% | 1.611% | -5.75% | -15.07% | ||||||||
| 30-year Treasury bond | 2.721% | 2.745% | -4.56% | -5.82% | ||||||||
| Currencies | ||||||||||||
| U.S. Dollar Index | 81.14 | 81.106 | 1.44% | 0.77% | ||||||||
| British pound | 1.5878 | 1.5883 | -1.60% | 2.19% | ||||||||
| (in U.S. $) | ||||||||||||
| U.S. $ in pounds | £0.630 | £0.630 | 1.63% | -2.14% | ||||||||
| Euro in dollars | $1.27 | $1.27 | -1.94% | -1.91% | ||||||||
| (in U.S. $) | ||||||||||||
| U.S. $ in euros | € 0.787 | € 0.787 | 1.98% | 1.94% | ||||||||
| U.S. $ in yen | 79.55 | 79.55 | -0.31% | 3.18% | ||||||||
| U.S. $ in Chinese | 6.25 | 6.23 | 0.33% | -1.13% | ||||||||
| yuan | ||||||||||||
| Canada dollar | $0.998 | $1.001 | -0.20% | 1.76% | ||||||||
| (in U.S. $) | ||||||||||||
| U.S. dollar | $1.002 | $0.999 | 0.27% | -1.73% | ||||||||
| (in Canadian $) | ||||||||||||
| Commodities | ||||||||||||
| Gold (-GC) | $1,724.80 | $1,730.900 | 0.33% | 10.08% | ||||||||
| (per troy ounce) | ||||||||||||
| Copper (-HG) | $3.471 | $3.468 | -1.32% | 1.02% | ||||||||
| (per pound) | ||||||||||||
| Silver (-SI) | $32.487 | $32.522 | 0.53% | 16.38% | ||||||||
| (per troy ounce) | ||||||||||||
| Wheat (-ZW) | $8.510 | $8.5775 | -1.56% | 30.37% | ||||||||
| (per bushel) | ||||||||||||
| Corn (-ZC) | $7.235 | $7.18 | -4.27% | 11.91% | ||||||||
| (per bushel) | ||||||||||||
| Cotton | $0.7081 | $0.707 | 1.06% | -22.76% | ||||||||
| (per pound) | ||||||||||||
| Coffee | $1.4600 | $1.531 | -5.59% | -36.42% | ||||||||
| (per pound) | ||||||||||||
| Crude oil (-CL) | $85.38 | $85.570 | -1.00% | -13.61% | ||||||||
| (per barrel) | ||||||||||||
Businesses are making profits. And spending too! Just not here in the states.
$$$$$$$$$$$$$$$$
I'll re-iterate that the idea of higher taxes alone is not enough or will fix what ails us.
Administrators, lawyers, bankers, politicians and business inheritors all are well-off or rich but not by effort, more like by station.
Families, labor & small business are suppressed and impoverished. Flat out... those who take have taken too much and MUST give back. You say- one issue at a time but while Congress took six months off, America was impaled on what BIG has stuck us with-- debt and NO job recovery. It is only FICTION that people are lazy and cannot find work. It is TRUTH that a tier class separation is behind it and blockading has destroyed us.
WHY are there no bankers in JAIL? WHERE does the money come from that is used to puff the markets up in the morning and are recalled after 3pm? WHERE are the lenders that are critical to the credit and housing mess corrections? Bankers are not lenders. Harvard U cannot produce a person capable of fixing what bankers have abused. Are we to WAIT on 12/21/12 and be "surprised" or are YOU going to do more than 'propose'? We want SOLUTIONS. If Congress is stalemated by that Norquist Pledge, arrest those who signed it and send them to GITMO. We don't tolerate terrorism in America, even if it's in Congress.
Hard work isn't paying. Corruption is. If you want Americans to swing over to the dark side and fry up some grubbers and inheritors... so be it. If you would prefer more integrity... tell Boehner to DO IT NOW and tell McConnell to resign.
Beginning IMMEDIATELY, a list of lobbies who are in contact with elected Officials is to be put on major media websites with blog (not social network gimmick) access for comments. Time to tell members of Congress who are not sweating out progress, where they can go and how fast. I PAY TAXES on 70% LESS INCOME than I once had. No one has helped us in 4 years now. It isn't about 47%, its about deadbeats who take and have ruined. DO YOUR JOB, DESTROY WHAT DESTROYS AMERICA.
Did he just call the current POTUS incompetent? Obama sure has used a lot of "tools" over the last 4 years. He could learn a thing or two from Tomlin.
The Shock Doctrine is a book by Naomi Klein that describes a "disaster capitalism" strategy used by wealthy and powerful people to take advantage of crises -- even causing crises (fiscal cliff) -- to herd people into accepting "solutions" to those crises that really just enrich the 1 percent at the expense of the rest of us.
In times of crisis (real or perceived, fiscal cliff) the public is in a state of shock, distracted and ready to grasp at straws to get out of the panic. This is the perfect time for "serious people" to come in and offer pre-planned "solutions." These solutions usually involve privatizing public institutions and wealth, cutting public services, cutting taxes on the rich, seizing property, lowering wages and pensions... well, just look at Europe's "austerity" and you get the picture.
This shock-doctrine disaster capitalism model (fiscal cliff) has become standard practice. We see this happening over and over again: Crises occur or are manufactured, the media whips people into a panic, and then the "solution" is introduced. The solution involves a "reform" that transfers wealth or institutions into a few private hands.
Read The Shock Doctrine!
Obama has added 5 trillion dollars to the national debt which is now over 16 trillion. Your great grandchildren won't be able to put a dent in this if they can find job...lol Obamacare will cause health insurance premiums to skyrocket. Businesses will get rid of full time jobs so no healthcare insurance will be offered.
More and more jobs are being called "contract jobs" or 1099. It's a form of outsourcing jobs to americans who will get no benefits of any kind. I have seen this happen with many companies including the one i worked for. The days of employee benefits are over.
Americans will have to pay a government tax penalty for not having health insurance. This is a recipe for disaster that Obama has created and for you morons who voted for Obama, you deserve what you get.
So Gotta go!! Hear to BO-DUMBO-CARE;
BO-DUMBO promised you could keep your doctor, but did not promise you would keep your job!!
Papa John’s Pizza to Cut Worker’s Hours Due to Obamacare
■Welch-Allyn: the well-known company that makes medical diagnostic equipment, plans to cut 10% of it’s workforce over the next 3 years, or about 275 people. If you’ve been to the doctor anytime in the last decade, you probably saw “Welch-Allyn” stamped somewhere on the tools your doctor used to check your blood-pressure, temperature, or many other areas.
■Dana Holding Corp: those of you in the auto parts industry have heard of them. This Ohio-based company estimates at least a $24 million dollar hit due to Obamacare, and numerous cuts in workers will be made in the next couple of years.
■Stryker: one of the biggest manufacturers of medical devices (including many of the beds you’ve seen in our area hospitals) will close their facility in Orchard Park, New York, dropping 96 jobs, and as many as 1,170 worldwide.
Other companies planning Obamacare-related cuts include:
Smith & Nephew – 770 layoffs
Abbott Labs – 700 layoffs
Covidien – 595 layoffs
Kinetic Concepts – 427 layoffs
St. Jude Medical – 300 layoffs
Hill Rom – 200 layoffs
Beyond the complete elimination of a significant number of American jobs is another looming problem created by the health care law – a shift from full-time to part-time workers. But it doesn’t stop there. Hundreds of companies, due to the mandates of the law, will be forced to reduce many full-time workers to less than 28 hours a week. In order to avoid paying millions in costly Obamacare penalties companies will have to reduce the hours of what are called “non-exempt” or hourly workers. Kroger, the major store chain, reports these cuts to what is essentially part-time work, could affect tens of thousands of workers.
So this is what the nation voted for????
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[BRIEFING.COM] The major indices have notched fresh highs with the Dow leading the way. The blue chip index trades higher by 0.4% as Home Depot (HD 78.84, +2.08) and JPMorgan Chase (JPM 53.39, +1.10) provide notable support. On the downside, Travelers (TRV 84.54, -1.01) is the biggest index underperformer, trading lower by 1.2%. Outside of Travelers, no other Dow component trades with a loss larger than 0.4%.
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