Stocks suffer worst weekly loss since May

The Dow ends up slightly; the Nasdaq and S&P 500 slip. Wells Fargo and JPMorgan earnings beat estimates, but margins are squeezed. Apple moves higher. Google falls on antitrust worries. Oil and gold fall.

By Charley Blaine Oct 12, 2012 12:55PM
Charley BlaineUpdated: 6:18 p.m. ET

Stocks struggled for most of the day just to end flat after giving up an early rally. In the process, the major indexes suffered their worst weekly losses since the very end of May.

The early rally fizzled despite rising consumer confidence, and earnings beats from banking giants JPMorgan Chase (JPM) and Wells Fargo (WFC). But shares of both companies fell because of worries that profit margins were shrinking.

The Dow Jones industrials ($INDU) gave up all of an early 75-point gain by noon ET. But, in finishing with a tiny gain, they broke a four-day losing streak. The Nasdaq Composite Index ($COMPX) was lower for the sixth straight day. The Standard & Poor's 500 Index ($INX) was lower for the fifth time in the last six days.

The market's desultory performance came as the first week of earnings season ended. Next week, Wall Street faces a much bigger set of results, including reports from Citigroup (C), Bank of America (BAC), Goldman Sachs (GS), Coca-Cola (KO), IBM (IBM), Microsoft (MSFT, publisher of MSN Money) and McDonald's (MCD).

The Dow finished up 2 points to 13,329. The S&P 500 was off 4 points to 1,429, and the Nasdaq slipped 5 points to 3,044. However, the Nasdaq-100 Index ($NDX), which tracks the largest Nasdaq stocks, was up 1 point to 2,720, and the Dow Jones Transportation Average ($DJT), regarded as a leading economic indicator, was up 44 points to 5,045.

Article continues below.
Europe also was a factor today. Rallies in most European markets faded at their close as concern about when Spain will apply for a financial rescue grew.

The Dow fell 2.1% for the week, with the S&P 500 down 2.2% and the Nasdaq down 2.9%, their worst weekly performance since the week of May 28-June 1. For the year, the Dow is up 9.1%, with the S&P 500 up 13.6% and the Nasdaq up 16.9%.

Crude slides; gold also drops
Crude oil
(-CL) in New York settled down 21 cents to $91.86 a barrel and was up 2.2% for the week. Brent crude in London was off $1.09 to $114.62 a barrel and was up 2.3% for the week.

The national average retail price of gasoline was at $3.81 a gallon, down from $3.813 a gallon Thursday, according to AAA's Daily Fuel Gauge Report. It was off slightly on the week.

Gold (-GC) settled down $10.90 to $1,761.50 an ounce. For the week, the metal was down 1.2%, its worst weekly performance since the week ended July 6. Silver (-SI) was off 41.3 cents to $33.669 an ounce. It was off 2.6% for the week -- its biggest decline since the week ended June 22. Copper (-HG) was off 4.85 cents to $3.703 a pound.

The 10-year Treasury yield fell to 1.663% from Thursday's 1.675% and 1.73% a week ago.

Markets for the week



10/12/2012

10/5/2012

% chg.

YTD chg.
Dow Industrials

13,328.85

13,610.15

-2.07%

9.10%
S&P 500

1,428.59

1,460.93

-2.21%

13.60%
Nasdaq 

3,044.11

3,136.19

-2.94%

16.85%
Russell 2000

823.10

842.86

-2.34%

11.09%
Crude oil 

$91.86

$89.88

2.20%

-7.05%
(per barrel)

0.00

0.00

0.00%

0.00%
U.S. Dollar Index 

79.74

79.43

0.39%

-0.97%
10-yr. Treasury

1.66%

1.73%

-3.98%

-11.12%
Gold

$1,759.70

1,780.80

-1.18%

12.31%

Apple provides a boost
The Nasdaq-100 was helped in part by Apple (AAPL). The tech giant closed up $1.61 to $629.71.

The shares had fallen below $630 on Thursday for the first time since Aug. 10 and ended the day down 10.5% from their closing peak of $702.10 on Sept. 19. A decline of 10% or more is a popular definition for a correction.

Apple is expected to introduce its new mini-tablet on Oct. 23.

Google may face antitrust charges
But Google (GOOG) was off $6.73 to to $744.75 on a Reuters report that the Federal Trade Commission is nearing a decision to start an antitrust suit against the search giant.

Four of the FTC commissioners have become convinced after more than a year of investigation that Google illegally used its dominance of the search market to hurt its rivals, while one commissioner is skeptical, three sources told Reuters.

Google rivals specializing in travel, shopping and entertainment have accused the world's top search engine of unfairly giving their websites low quality rankings in search results to steer Internet users away from their sites and toward Google products that provide similar services.

Housing is strong for JPMorgan, Wells Fargo; profit margins a concern
JPMorgan Chase and Wells Fargo, two of the nation's largest mortgage lenders, offered relatively optimistic views of the housing market. Demand for loans is increasing, especially for refinancings. But executives also said home buying is gaining strength.

At the same time, the number of problem loans is decreasing, allowing the banks to trim their loan-loss reserves. That, in turn, boosted profit.

JPMorgan’s third quarter exceeded estimates on higher mortgage revenue. Perhaps as important, the company began to put its "London Whale" trading losses behind. Shares were down 48 cents to $41.62.

But Wells Fargo disappointed with a shrinking net interest margin -- the profit margin from lending. It was 3.66%, down from 3.91% in the second quarter. Shares were down 93 cents to $34.25.

Energy prices -- New York close



Fri.

Thur.

Month chg.

YTD chg.
Crude oil (-CL)

$91.86

$92.07

-0.36%

-7.05%
(per barrel)











Heating oil (-HO)

$3.2239

$3.2571

2.05%

10.63%
(per gallon)











Natural gas (-NG)

$3.6110

$3.6040

8.77%

20.81%
(per mil. BTU)











Unleaded gasoline (-RB)

$2.8928

$2.9556

-0.93%

8.86%
(per gallon)











Brent crude 

$114.62

$115.71

2.32%

6.74%
(per barrel)











Retail gasoline

$3.8100

$3.8130

0.61%

16.30%
(per gallon; AAA)












A bullish reading on consumers; higher gasoline weighs on wholesale prices
U.S. consumer sentiment unexpectedly rose to its highest level in five years in October in the latest in a string of encouraging signs for the economy that may boost President Obama's re-election hopes as voters go to the polls next month.

The Thomson Reuters/University of Michigan's preliminary October reading on the overall index on consumer sentiment came in at 83.1, up from 78.3 the month before, and the highest since September 2007.

The Labor Department said Friday that wholesale prices rose 1.1% in September. But most of the gain was from higher gasoline prices. Core prices, which don't count food and energy, were unchanged.

Financials weigh on the markets
Not surprisingly with lower prices for JPMorgan and Wells Fargo, financial stocks were the market's weakest sector.

Only 11 of the 30 Dow stocks were higher today, led by Boeing (BA), Hewlett-Packard (HPQ), Wal-Mart Stores (WMT) and IBM (IBM). IBM's gain of $2.04 to $207.80 contributed 16 points to the Dow and was a big reason the average ended higher. IBM reports third-quarter results after Tuesday's close.

The laggards were Bank of America  (BAC), which reports on Wednesday, followed by AT&T (T) and Verizon Communications (VZ).

Meanwhile, 119 S&P 500 stocks were higher, led by Monster Beverage (MNST) and used-car dealer Carmax (KMX). The laggards were Advanced Micro Devices (AMD), which issued an earnings warning late Thursday, and Dollar Tree (DLTR).

Monster Beverage, Dell (DELL) and Electronic Arts (EA) were the Nasdaq-100 leaders. Infosys (INFY) and Vertex Pharmaceuticals (VRTX) were the laggards. Only 37 stocks in the index had gains.

Short hits from the markets -- New York close



Fri.

Thur.

Month chg.

YTD chg.
Treasury yields











13-week Treasury bill

0.1000%

0.100%

11.11%

900.00%
5-year Treasury note 

0.663%

0.663%

5.24%

-20.12%
10-year Treasury note

1.663%

1.675%

1.59%

-11.12%
30-year Treasury bond

2.835%

2.855%

-6.50%

-1.87%
Currencies











U.S. Dollar Index

79.74

79.860

-0.36%

-0.97%
British pound

1.6080

1.6054

-0.50%

3.49%
(in U.S. $)

 








U.S. $ in pounds

£0.622

£0.623

0.50%

-3.37%
Euro in dollars

$1.30

$1.29

0.80%

0.00%
(in U.S. $)

 








U.S. $ in euros

€ 0.772

€ 0.773

-0.80%

0.00%
U.S. $ in yen 

78.55

78.40

0.75%

1.89%
U.S. $ in Chinese

6.29

6.28

0.09%

-0.62%
yuan











Canada dollar

$1.021

$1.022

0.44%

4.08%
(in U.S. $)

 








U.S. dollar 

$0.980

$0.978

-0.36%

-3.93%
(in Canadian $)

 








Commodities

 

 

 

 
Gold (-GC)

$1,759.70

$1,770.600

-0.80%

12.31%
(per troy ounce)

 








Copper (-HG)

$3.703

$3.752

-1.46%

7.77%
(per pound)

 








Silver (-SI)

$33.6690

$34.082

-2.63%

20.61%
(per troy ounce)

 








Wheat (-ZW)

$8.5675

$8.860

-5.07%

31.25%
(per bushel)

 








Corn (-ZC)

$7.5275

$7.733

-0.46%

16.43%
(per bushel)

 








Cotton 

$0.7136

$0.707

1.00%

-22.16%
(per pound)

 








Coffee

$1.6170

$1.608

-6.80%

-29.59%
(per pound)

 








Crude oil (-CL)

$91.86

$92.070

-0.36%

-7.05%
(per barrel)










 

393Comments
Oct 12, 2012 1:47PM
avatar
I cannot believe that Biden repeated the lie that is the Libya terror attack cover up. What was he thinking? 

Everyone but the White House has accepted the fact that the attack was planned. There was not even a protest going on at the time. 

Quit blaming YouTube.
Oct 12, 2012 1:45PM
avatar
On the big banks - We need to break up the monopolies that caused "too big to fail".
I remember when I knew my local banker and we could sit down and talk. I still know him, but with the current regulations he is now owned by the big bank and he couldn't make a loan if his life depended on it.

Also we need to say good bye to the FED. Sorry PBS - maybe you too...
Oct 12, 2012 2:03PM
avatar

10:27 p.m. EDT

Biden attacks Ryan's budgets with a series of lies about the programs and funding that will be cut, as well as tax cuts that he proposes. Ryan points out that his budget does not actually cut government spending, but slows the rate of growth to 3%. He adds that not raising taxes is not the same thing as cutting taxes. Biden uses the line about voting for wars that were not paid for--and Ryan points out, amidst the crosstalk, that Biden voted for those wars.

10:29 p.m. EDT

Biden has complained--for the third or fourth time--that he is not receiving as much time to speak as Ryan. In fact, as CNN's debate clock shows, Biden has had more time--over a minute more, in fact, and he has never had less time than Ryan throughout the debate.

10:34 p.m. EDT 

Biden has, once again, lied through a debate--and he has also managed to smirk through it, betraying a contempt for his opponent that is almost disqualifying and that managed to outrage even friendly media.

10:50 p.m. EDT

The media commentary is focusing on two major Biden lies: one, that the Obama administration was never asked for more security in Benghazi (it was, as we now know from testimony to Congress this week); and two, that Obamacare's cuts to Medicare do not cut benefits (they do, as Ryan pointed out in his response).

Oct 12, 2012 2:15PM
avatar
If a wise man has a debate with a fool, the fool only rages and laughs and there is no quiet. 

Proverbs 29:9

Biden, quit laughing and be quiet....fool
Oct 12, 2012 2:09PM
avatar
Tampa Bay Times...October 12th, 2012

Romney has opened a sizable 7 point lead in Florida.
Oct 12, 2012 2:26PM
avatar

We were told that Biden was an expert on foreign affairs.

Now it looks like he just watches Bill Clinton when he goes out of the country…

Oct 12, 2012 2:51PM
avatar
americans better have their guns ready, because if  big o wins, we the people will lose all
Oct 12, 2012 5:14PM
avatar

Want to fix the economy and state of the union? Make ALL congress/senate/everyone have the same medicare, SS and pensions.

Make them have term limits,6yr,8yr whatever. Don't give me the vote crap. We all know it is impossible to get rid of the leaches once they are in. Make them leave. Ban ALL politicians from serving as lobbiests after their terms are over.

You'll se change, in a hurry.

Oct 12, 2012 3:13PM
avatar
Getting sick of the Euro worries.... there has been Euro worries for 3+ years now.  They keep making dates about when they will explode and it never happens, always a bailout or partial save.  Seems like an excuse when the writers just don't know why the market drops on a given day.
Oct 12, 2012 1:34PM
avatar
The libor scandal is catching up with the fraudulant bankers!And now there is no working class manufacturing(taxable) jobs to bail them out! I wonder why we dont hear much on that libor scandal at all!!
Oct 12, 2012 3:04PM
avatar
Not Buying - Biden doesn't want you to hear what Ryan has to say.  Like all good socialists, he must rely on censorship in order to win.
Oct 12, 2012 1:49PM
avatar
I find it interesting that they said at the debate that we have a brigade of marines guarding our embasy in France and far fewer marines were guarding our embassy in Libya.  I didn't realize how dangerous a place France was for our diplomats.  Or, is it just that this administration doesn't have a clue how to operate our foreign embassies and for that matter, the overall foreign policy of the US.
Oct 12, 2012 1:34PM
avatar
Good afternoon all - My 2 cents...

Hezbollah: "That Was Our 'Iran-Made' Drone Over Israel" (October 6th News).

I suppose Biden did not know Iran has such capability, since he  told us they did not last night.
He also told us they did not know about the terror attack because our inteligence agency did not know it was and that he did not know that they needed more security.
Even if none was asked for, you would think that on 9/11 we would have enhanced security everywhere possible even without a warning.

I'm stunned how little we seem to know about anything right now.

Oct 12, 2012 1:53PM
avatar

New York Post - October 11th, 2012


Eric Nordstrom, the State Department’s regional security officer for Libya, twice sought to enhance security for US missions there in the wake of cutbacks in the months before the 9/11 attack.

But Nordstrom says his requests were ignored by Washington “because there would be too much political cost.”

Instead, he was given a “danger pay” hike when 16 US soldiers from a Site Security Team and 18 members of three Mobile Security Deployments were yanked.

Clearly, the hazardous-duty pay means the State Department recognized the increasing risks in Libya.

Yet State Department official Charlene Lamb — who refused the manpower requests — testified yesterday that “we had the correct number of assets in Benghazi on the night of 9/11.”

That’s self-evidently false — to say nothing of insane — but it also telegraphs the administration’s cluelessness about the region.

After the 16 soldiers were removed, “there was a complete and total lack of planning for what was going to happen next,” Nordstrom said. “There was no plan, there was just hope that everything would get better.” It didn’t.

The Benghazi mission was sacked, four Americans — including Ambassador Chris Stevens — were murdered and the White House sought to cover things up by calling the well-coordinated strike an “impromptu” protest against an obscure online video.

Oct 12, 2012 4:30PM
avatar

Bank of America claims death of a child not a HARDSHIP ? Surviving parents request a loan modification and are denied by B/A. Bank subsequently starts foreclosure proceeding ?   This is a Bank that you want to do business with !  DIE BANK OF AMERICA DIE !

Oct 12, 2012 1:55PM
avatar
I'm loving all the stuff about Ryan not ready to be V.P..
We only got Biden as a V.P. for experience, since the top guy had absolutely (underline absolutely...) NO EXPERIENCE.

Biden may have experience, but I question in what? Making faces, interrupting, looking mad at the moderator, pointing at the camera. He may want to go to those briefings on security that Obama does not have time for...
Oct 12, 2012 1:55PM
avatar

The White House’s attention has been elsewhere: Eager to proclaim victory in the War on Terror, President Obama spent a year celebrating Osama bin Laden’s death at the hands of Navy SEALs — claiming that al Qaeda was “devastated,” “decimated” and “on its heels.”

That’s not true in Iraq, where the number of al Qaeda fighters has more than doubled, from 1,000 to 2,500, since Obama withdrew US forces last year — and where there are now 20 al Qaeda attacks every single day.

And it’s not true in Libya, where Lt. Col. Andrew Wood, the former commander of the State Department Site Security Team there, told Congress al Qaeda is on the rise.

“Their presence grows there every day. They are certainly more established there than we are,” Wood said yesterday.

Of course they are.

Just as all but the sunniest optimists said they would be as the administration’s “leadership from behind” fell quickly to pieces after Moammar Khadafy’s inglorious fall.

Osama may be dead.

But al Qaeda is very much alive.

Another Barack Obama failure.

Oct 12, 2012 3:24PM
avatar
“Strange as it seems, no amount of learning can cure stupidity, and higher education positively fortifies it.” (Stephen Vizinczey), and if we get 4 more years of NOBAMA we have no one but our selves to blame
Oct 12, 2012 2:12PM
avatar
Biden opened up something sizeable after the debate, another bottle of Vodka.
Oct 12, 2012 4:34PM
avatar
NBCNews; “We weren't told they wanted more security,” Biden said. “We did not know they wanted more security men"
"But the State Department did know that requests for more security resources had been made and were turned down.  A State Department official acknowledged that, testifying Wednesday on Capitol Hill."

"And the vice president was incorrect when he suggested tonight that he did not support the two wars because the country could "not afford" them. Biden voted for both wars."
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