Dow off 121 as post-election swoon continues

Investors worry about the economy, the fiscal cliff and Europe. Disney and Nordstrom earnings disappoint. Apple continues its slide since September. McDonald's monthly sales fall for the first time in 9 years. Gold and crude oil move higher.

By Charley Blaine Nov 8, 2012 2:23PM
Charley BlaineUpdated: 10:40 p.m. ET

Stocks finished at their lowest levels since the summer today as another slide in Apple (AAPL) shares pulled tech stocks lower and McDonald's (MCD) reported a surprising decline in October sales.

Apple was down $20.25 to $537.75, its seventh loss in the last 11 days, on worries that production problems are limiting iPhone 5 availability. There's talk investors are starting to ask what the company's next big wonder product might be. McDonald's was off $1.73 to $85.13 and was the biggest weight on the Dow Jones Industrial Average ($INDU), which fell for the second day in a row.

The major indexes all ended the day below their 200-day moving averages, which are key indicators of investor confidence.

After the close, shares of Walt Disney (DIS) were off 97 cents to $49.07. The company reported fiscal-fourth-quarter earnings of 68 cents a share, up from 59 cents a year ago and in line with Street estimates. Revenue of $10.78 billion, up from $10.43 billion, missed the Street estimate of $10.92 billion. Nordstrom (JWN) shares also were falling after hours as earnings of 71 cents a share missed the Street estimate of 72 cents.

The Dow closed down 121 points to 12,811, its lowest close since July 25. The Standard & Poor's 500 Index ($INX) was off 17 points to 1,378, its lowest close since Aug. 2. The close for the Nasdaq Composite Index ($COMPX) was 2,896, down 42 points, and its lowest close since July 23. The Nasdaq-100 Index ($NDX), heavily influenced by Apple, was down 40 points to 2,573.

Article continues below.
McDonald's said same-store sales fell 1.8% in October, as consumers flocked to rivals, including Burger King (BKW), which has been revamping its menus. The company said sales were down 2.2% in the U.S. and Europe. Sales fell 2.4% in its Asia Pacific, Middle East and Africa region. McDonald's contributed more than 13 points to the Dow's loss by itself. Half of the Dow's loss came from declines in McDonald's, United Technologies (UTX), Caterpillar (CAT), Home Depot (HD) and Chevron (CVX).

The Dow has fallen 434 points in two days. That's its worst two-day loss since the blue chips fell 573 points on Oct. 31-Nov. 1, 2011.

The euro's fall hurts U.S. stocks; oil and gold rise
The euro fell to a two-month low against the dollar after the European Central Bank held interest rates at a record low and said the eurozone economy showed little sign of recovering before year-end.

In addition, a European Union official said a decision on unlocking funds for Greece may not be made until late November. European stocks closed lower. A falling euro (or a rising dollar) makes U.S. exports less competitive.

Crude oil (-CL) in New York settled up 65 cents to $85.09 a  barrel today. Gold (-GC) settled up $12 to $1,724.20 an ounce.

The 10-year Treasury yield was 1.632%, unchanged from Wednesday.

Energy prices -- New York close



Thur.     Wed.

Month chg.

YTD chg.
Crude oil (-CL)

$85.09

$84.44

-1.33%

-13.90%
(per barrel)











Heating oil (-HO)

$2.9554

$2.9621

-3.49%

1.41%
(per gallon)











Natural gas (-NG)

$3.6080

$3.5780

-2.28%

20.71%
(per mil. BTU)











Unleaded gasoline (-RB)

$2.6073

$2.5889

-0.87%

-1.89%
(per gallon)











Brent crude 

$107.25

$106.82

1.49%

-0.12%
(per barrel)











Retail gasoline

$3.4640

$3.4620

-1.62%

5.74%
(per gallon; AAA)












A nervous market
Investors were probably a little punchy after stocks suffered their worst one-day losses in nearly a year with the Dow's 313-point drop on Wednesday. 

The sell-off was due in part to President Obama's re-election and the uncertainty because of the so-called "fiscal cliff" -- the combination of tax hikes and spending cuts that will kick in starting Jan. 1 unless Congress and the White House can agree on changes.

The fiscal cliff would drive the U.S. economy back into recession next year and result in a jump in the jobless rate to 9.1% by the end of 2013, a new report from the Congressional Budget Office said.

The CBO,  the independent budget arm of Congress, said economic output would drop by 0.5% in 2013 without action. But the CBO added the U.S. economy would in the longer run return to better growth rates and lower employment, with the U.S. unemployment dropping perhaps to 5.5% by 2020, The Wall Street Journal noted.

In addition, worries are deepening about economic woes in Europe. Germany's economy is starting to slow down, and political tensions were high in Greece after its parliament agreed to new austerity measures.

The Dow and S&P 500 are off roughly 6% since a market peak in mid-September. The Nasdaq has fallen 9.1% since Sept. 14, when it closed at a 2012 high of 3,184.

If the fiscal cliff takes effect, it will result in an increase in tax rates on dividends.

Because of that potential, Leggett & Platt (LEG), which makes components used in bedding and furniture, accelerated the payment of its fourth-quarter dividend of 29 cents a share to Dec. 10 to qualify for 2012 tax rates. Leggett & Platt was down 17 cents to $26.84.

Lastly, the third-quarter earnings season has produced profits that have met estimates for the most part. Revenues for S&P 500 companies are beating estimates less than 40% of the time, instead of the usual 62%. Part of that is due to slowing non-U.S. business and the dollar's depressing effect on international revenue. If the dollar rises, the value of non-U.S. revenue falls.

The Apple effect on markets
The peaks for the major averages appear to  tracking with Apple's tumble from an all-time closing high of $702.10 on Sept. 19 and a record intraday high of $705.07 on Sept. 21.

The reason to concentrate on Apple is that it is the world's most valuable company, and it has shed about $143 billion in market capitalization as the stock has slid more than 22% since those September highs. Apple represents about 17% of the market capitalization of the Nasdaq-100 and 4% of the S&P 500.

There are lots of reasons why Apple has fallen so much. The stock was up 73% for the year at its peak. By a number of measures, the shares were overbought, and it's vulnerable to violent moves because it is the largest holding of many of the biggest hedge funds. If they start to sell, bad things can happen quickly.

It is possible that Apple is nearing a bottom. Its 14-day relative strength index was below 22 today. The index measures a stock's momentum. A reading below 30 implies a stock is oversold. A reading above 70 suggests a stock is overbought and nearing a pullback.

Another broad slump
Only four of the 30 Dow stocks were higher today: Bank of America (BAC), Boeing (BA), Hewlett-Packard (HPQ) and Travelers Companies (TRV). The laggards were Cisco Systems (CSCO) and McDonald's.

In addition, only 146 S&P 500 stocks were higher, along with 194 Nasdaq-100 stocks.

Chipmaker Qualcomm (QCOM, Century Link (CTL) and Verisign (VRSN) were the S&P 500 leaders. Qualcomm's fiscal-fourth-quarter earnings beat Street estimates, thanks to an explosion in demand for smartphones. It boosted its first-quarter guidance.

Verisign and Qualcomm were also the top Nasdaq-100 stocks. Whole Foods Market (WFM) and SanDisk (SNDK) were the laggards.

Whole Foods, down $5.62 to $90.31, offered lower-than-expected guidance for the fiscal first quarter. Results will be hurt by disruptions to its operations in the Northeast by Superstorm Sandy.

Short hits from the markets -- New York close



Thur.

Wed.

Month chg.

YTD chg.
Treasury yields











13-week Treasury bill

0.0900%

0.100%

-18.18%

800.00%
5-year Treasury note 

0.643%

0.662%

-10.07%

-22.53%
10-year Treasury note

1.632%

1.632%

-3.20%

-12.77%
30-year Treasury bond

2.769%

2.821%

-2.88%

-4.15%
Currencies











U.S. Dollar Index

80.886

80.867

1.12%

0.45%
British pound

1.5990

1.5990

-0.91%

2.91%
(in U.S. $)

 








U.S. $ in pounds

£0.625

£0.625

0.92%

-2.83%
Euro in dollars

$1.28

$1.28

-1.63%

-1.59%
(in U.S. $)

 








U.S. $ in euros

€ 0.784

€ 0.783

1.66%

1.62%
U.S. $ in yen 

79.41

79.95

-0.49%

2.99%
U.S. $ in Chinese

6.26

6.24

0.48%

-0.98%
yuan











Canada dollar

$1.000

$1.004

-0.02%

1.95%
(in U.S. $)

 








U.S. dollar 

$1.000

$0.996

0.02%

-1.98%
(in Canadian $)

 








Commodities

 

 

 

 
Gold (-GC)

$1,726.00

$1,714.000

0.40%

10.16%
(per troy ounce)

 








Copper (-HG)

$3.470

$3.442

-1.36%

0.97%
(per pound)

 








Silver (-SI)

$32.2400

$31.661

-0.24%

15.49%
(per troy ounce)

 








Wheat (-ZW)

$9.0250

$8.940

4.40%

38.26%
(per bushel)

 








Corn (-ZC)

$7.4125

$7.443

-1.92%

14.66%
(per bushel)

 








Cotton 

$0.6926

$0.698

-1.16%

-24.45%
(per pound)

 








Coffee

$1.5140

$1.512

-2.10%

-34.07%
(per pound)

 








Crude oil (-CL)

$85.09

$84.440

-1.33%

-13.90%
(per barrel)










 

759Comments
Nov 8, 2012 4:25PM
avatar

so funny reading these posts. I hate Obama but Romney is just as bad. Sounds like the world is going to end. Did you all lose your jobs? Oh wait, all you do all day is sit around and talk crap on here and invest your money. You guys don't know what an honest living is. Thats the problem.

Nov 8, 2012 4:24PM
avatar
Soi MSN contnues the hit jobs onthe wealthy as their lead article.  I am loking forward to the market crash that they wil lown this time, if it is any consolation to the re-eleciton of a person who was not as good as mcCain and not as good as Romney but won with the help of a complicit mainstream media, a bunch olie sin a nasty campaign and abunch of special interest know nothings.
Nov 8, 2012 4:21PM
avatar
Classic, once again you take fact and turn it into fiction....Burn Baby Burn, that slogan originated from the race riots of the sixties, LA, Detroit.....it had nothing what so ever to do with the hippie/peace movement of the time.  You are such a spin mistress and a purveyor of falsehoods and bull crap.
Nov 8, 2012 4:17PM
avatar
Not really being one to wish anybody ill fate, after listening to that arrogant pos Harry Reid speak from the Senate chambers yesterday it seems that the best way to fix this country could be a few well placed  funerals. Just saying.
      Over 11 million fewer votes cast in this election than in 2008. Were they all Repubs? Or is it more of the country has gotten like Florida than is being reported.

Nov 8, 2012 4:07PM
avatar
Recovery should be re-named to survival. Glad I took some of my profit a few days before the election and squirrelled it away as cash for now, it will earn zilch in the bank but at least it's where the principle remains until the dust settles, expect we will see 11,000 by year end. I'll hang onto things that pay a decent dividend, the necessities like utilities, food and fuel and toothpaste, forget the big banks and financials, Dodd Frank et al makes those kinda scary. No I did not vote for the "winners" and if I pull in my pursestrings another notch I won't starve, as usual it will be the frail elderly and disabeled who cannot help themselves who will bear the brunt. Those up there in the ivory towers can't see old folks shivereing in the cold flats when they can't pay the heat but they'll have their multi-million dollar inaguration balls and betcha the "leftovers" won't be offered to the soup kitchen, and us average-joes who pay for it won't get invited...... so we all better fasten our seatbelt for a bumpy ride.
Nov 8, 2012 4:07PM
avatar

Notice how Charley Blaine here, who spent all of last year mentioning Greece on every down turn, in mentioning continued declines from election; didn't bother to utter the word Greece on the same day that CNN just announced that protests in Greece have turned violent...

 

I guess it was a blame Greece until they could mention Obama, then suddenly with things looking ready to head to a revolution or pre-revolutionary phase, the financial press has at that time moved onto the new story, without taking a look back?

 

Yes it's ridiculous to invoke Greece on every sneeze the stock market takes, but at the same time, things falling into violent protest, perhaps a pre-revolutionary phase where some want to overthrow the current government there? wouldn't necessarily be without consideration in the minds of investors either.  Can we perhaps get a more balanced approach that isn't all or nothing, like today everything that happens has to be Greece as if nothing else exists; and tommarow everything has to be the elections, once again as if they existed in a vacuum and nothing else was going on in the whole wide world as well?

Nov 8, 2012 4:03PM
avatar
I predict the next great depression in the next four years and it can all be blamed on the progressive movement ( Obama and his various supporters).
Nov 8, 2012 4:03PM
avatar
Someone, please, call VL's mother and tell her he's in the basement at the computer, again!
Nov 8, 2012 4:03PM
avatar
1 Classic Lady
YOU AIN'T SEEN NOTHIN YET !!!!!!!!!!
------------------------------------------------------------
Yup, we only have to go down about 6K more and we'll be even with Dubya's numbers.
Nov 8, 2012 4:00PM
avatar
Lady,

What does Burn Baby Burn mean you want things to go bad?

or is it between your legs?
Nov 8, 2012 3:58PM
avatar
Soon, even the liberals who voted for Obama will have buyers remorse and realize this guy is ruining our country.  Unfortunately it's probably too late...
Nov 8, 2012 3:57PM
avatar
Freaky.....What did you dump, 20 shares of Facebook(FB) ?
Nov 8, 2012 3:57PM
avatar
I have to laugh at the article that Apple is that it is the world's most valuable company!!!!  Oh come on, give me a break.  Who was the J/A who came up with that one?  If apple desolved today, someone else what pick up the ball and run with it.  And they wouldn't have to constantly worry about apple suing everybody and their grandmother for copyright infringment and every other thing that they can think of. I will say what I said yesterday, W/S wanted Obama in the office again, then why are they waiting until he is back in to do a dive?  Seems to me, they played the dive trick on George Bush during the primaries and the general election to make sure that the republicans wouldn't get back into offce.  Maybe if W/S would have played this game a month back that maybe Obama may not be sitting in the top spot again!!!!  Thanks W/S for all your A-Hole moves!!!!!!!!
Nov 8, 2012 3:56PM
avatar
Some are up and some are down....Anybody notice.....Anybody ??
Nov 8, 2012 3:56PM
avatar
Polling organizations have been rated for their accuracy in the 2012 Elections....

PPP was number 1

NBC  was number 6     highest of all Network's

FOX 15th

RASMUSSEN     AT THE BOTTOM   around  28th   

Rasmussen polls were most used by FOX as Rasmussen skewed their numbers to Favor Mitt Romney......giving unrealistic FALSE hope to their Viewership..........ALL AMERICAN'S NEED TO REJECT FOX NEWS for the JOKE THEY ARE.......Many Fox pundits predicted a Romney Landslide, LMAO.....predicting well over 300 Electoral college votes......for Romney.......FOX is part of the problem in this country....

OH,  Almost forgot NATE SILVER,   fivethirtyeight.com    Predicted Every State Correctly and Every Senate Race except the unexpected win in North Dakota by a Democrat....


Nov 8, 2012 3:55PM
avatar
I have an idea on how the Republican Party can win the next election and every election for the next 20 years.  Pay Republicans to relocate to swing states.  Create good jobs in Ohio, Virginia, Florida, Colorado, Nevada, North Carolina etc...  If we can get Republicans in places like Georgia, South Carolina, Missouri and Texas to move and settle in those states we can turn them into a solid voting block and help the unemployment situation at the same time.  Of course this would mean that the major corporations would have to accept a lower profit margin.  Oh well, no idea is perfect.
avatar
All it takes, since so few actually pay at all, is about 10 million true taxpayers to refuse to pay their taxes to bring the madness to a halt.
Nov 8, 2012 3:49PM
avatar
Of course the same thing is happening on the legal pot push.......... When the suits end up making all the money from it down the road the libs will be scratching their pointy heads and saying why did we do that?
Nov 8, 2012 3:46PM
avatar
Lets see........ if there are 4,500,000 gays in the USA and half (like straight people) decide to get married thats 2,250,000 more married people. If half of those end up in divorce thats 1,125,000 new customers for the lawyers. Guess we know who made out like bandits on that decision.
Nov 8, 2012 3:45PM
avatar
1 Classic Lady
DOWN 71
BURN BABY BURN
---------------------------------------------
 
Traitor
Report
Please help us to maintain a healthy and vibrant community by reporting any illegal or inappropriate behavior. If you believe a message violates theCode of Conductplease use this form to notify the moderators. They will investigate your report and take appropriate action. If necessary, they report all illegal activity to the proper authorities.
Categories
100 character limit
Are you sure you want to delete this comment?

DATA PROVIDERS

Copyright © 2014 Microsoft. All rights reserved.

Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.

RECENT QUOTES

WATCHLIST

Symbol
Last
Change
Shares
Quotes delayed at least 15 min
Sponsored by:

MARKET UPDATE

NAMELASTCHANGE% CHANGE
There’s a problem getting this information right now. Please try again later.
NAMELASTCHANGE% CHANGE
There’s a problem getting this information right now. Please try again later.
Market index data delayed by 15 minutes

[BRIEFING.COM] The stock market capped the trading week with losses across the major averages. The S&P 500 fell 0.5% to surrender its weekly gain, while the Dow Jones Industrial Average (-0.7%) and Russell 2000 (-0.9%) underperformed. The two indices posted respective losses of 0.8% and 0.6% for the week.

Equity indices were pressured from the get-go after several heavyweights disappointed the market with their earnings and/or guidance, which led to some broader profit-taking. After ... More


Currencies

NAMELASTCHANGE% CHANGE
There’s a problem getting this information right now. Please try again later.
Sponsored by:

VIDEO ON MSN MONEY