Dow drops 266 after Boston explosions, gold plunge
A bad day for stocks becomes much worse after blasts kill at least 3, injure many more along the Marathon course. Gold suffers its worst 2-day loss since 1980.
Stocks suffered their worst losses of 2013 on Monday after two explosions killed at least three people -- one an eight-year-old child -- and injured at least 132 more near the finish line of the Boston Marathon.
Local media said the explosions in Copley Square were caused by bombs, and officials said a third device was found and detonated by Boston police. The injuries were savage; some victims lost limbs, the Boston Globe reported. More than a dozen children were injured, The New York Times said. Two thirds of the 23,000 runners had already completed the 117-year-old race when the bombs went off.
The selling began with disappointing reports on economic growth in China. Precious metals, especially gold (-GC) and silver (-SI) continued their sell-offs from Friday.
The Dow Jones industrials ($INDU) finished down 266 points to 14,599. The close was just above the Dow's low for the day of 14,598.58. The Standard & Poor's 500 Index ($INX) was off 36 points to 1,552. The Nasdaq Composite Index ($COMPX) slumped 78 points. The percentages losses for the three indexes were the worst since Nov. 7.
The Dow's point loss was its worst since Nov. 7. The point losses for the S&P 500 and Nasdaq were their worst since November 2011.
The sell-off may be the start of a long-expected market pullback. Many analysts have been predicting that stocks would fall 7% to 10% from recent peaks.
The worry has been that stocks have risen too far and too fast in 2013 when the U.S. economy doesn't appear to be that strong.
The Dow and S&P 500 hit all-time closing highs on Thursday. The Nasdaq hit a 12-year high on Thursday as well.
The Dow was still up 11.3% for the year, with the S&P 500 up 10% and the Nasdaq up 8.2%.
Traders have been concerned about slowing economic growth in the United States and China, as well as Europe's ongoing woes.
The Boston tragedy added to the market's woes on Monday, and it's not clear how much damage the day's turmoil will do to the market. The market barely blinked after terror attacks on London in 2005 and at the Atlanta Olympics in 1996.
But the Sept. 11, 2001 terror attacks shut U.S. financial markets for four days and led to a massive sell-off when trading resumed.
The selling in stocks was broad and persistent, although the volume wasn't especially heavy. Bond yields moved slightly lower as investors sought safety. The 10-year Treasury yield was 1.702%, down from Friday's 1.721%.
Futures trading late Monday suggested stocks could open modestly higher on Tuesday, but crude oil and metals futures were lower again.
Here's what else you need to know about Monday's markets.
The declines for gold and silver were shockingly large
Gold fell 9.3% to $1,361.10 an ounce, the lowest settlement price since February 2011. Since Thursday, gold has fallen $203.80, a decline of 13.2%. The two-day dollar decline was the largest ever; the percentage loss was the worst since March 1980. The one-day loss was the worst since February 1983.
Since peaking at around $1,920 an ounce in September 2011, gold is down around 29%. Silver has fallen 33% since September 2012.
Silver, meanwhile, fell $2.97, or 11.3%, to $23.36 an ounce. It's two-day loss was 15.7%.
What the heck happened? The metals have been under pressure for some time. For many investors and people who love jewelry, the price of gold moved too high. Even Indian buyers, among the largest in the world, dialed back.
Silver has pulled back in part in sympathy with gold. But silver has extensive industrial uses, and the prospect of a slowing global economy has hurt, too.
Oil prices have dropped, too -- good news for consumers
Light sweet crude oil (-CL) settled at $88.71 a barrel in New York, down $2.58, or 2.8%, from Friday. It was the lowest close since Dec. 24, and it had fallen to $87.25 in late Monday trading.
Brent crude, important because gasoline prices key off it, settled at $100.63 a barrel, down $2.41. It fell to as low as $99.12 in the regular session. In the after-hours market, Brent was trading at 98.97, down $1.66. Brent hasn't closed below $100 since July 11, 2011.
Light sweet crude is down 8.8% for the month and 3.4% for the year. Brent is down
The retail price of gasoline averaged $3.526 a gallon, according to AAA's Daily Fuel Gauge Report. That was down from Sunday's $3.532. The national average is up 7.1% for the year. That's a big savings from Feb. 27, when the average peaked at $3.786, up 15% for for the year.
Oil prices moved lower because of the global worries set off by the Chinese data.
The declines were the worst for the Dow and the S&P 500 since Feb. 25 and the worst for the Nasdaq since Nov. 7.
The weak links among stocks: mining, metals, energy and industrial stocks
The four biggest losers among the 30 Dow stocks were energy and industrial stocks: Caterpillar (CAT), Chevron (CVX), Exxon Mobil (XOM) and General Electric (GE).
Freeport-McMoRan Copper & Gold (FCX) was the biggest S&P 500 loser, down $2.65 to $29.27. Only seven S&P 50 stocks were higher, and the 10 sectors of the index were lower. So were all 30 Dow stocks. Wal-Mart Stores (WMT) was the best-performer, down 9 cents to $78.47.
Technology stocks were also weak. Apple (AAPL) closed at $419.85, down $9.95 and briefly touched $419.55. It's 52-week low is $419, and the shares are off more than 40% from peaks in September.
The market was unable to gain any traction from two deal stocks.
Sprint Nextel (S) jumped 84 cents to $7.06 after Dish Network (DISH) offered $25.5 billion in cash and stock and wrest the telecommunications company away from Softbank, the Japanese telecommunications company. Life Technologies (LIFE) was up 7.5% after agreeing to be acquired by Thermo-Fisher Scientific (TMO) for $13.6 billion.
Tuesday is a big day for earnings in what is expected to be a mediocre earnings season. Among companies set to report are Dow components Coca-Cola (KO), Johnson & Johnson (JNJ) and Intel (INTC) plus Goldman Sachs (GS), Northern Trust (NTRS) and Yahoo (YHOO).
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The stock market was tanking from the opening bell and was down 200+ points before any of this happened... If you are going for sensationalism then you hit the mark. If you are going for the truth you sure aren't showing it with your hyped headline.
headlne is total B.S. The market was just closing as the explosions occurred.
With volatility like this, you needn't wonder why the retail investors want no parts of this market. A simple rumor will move the market one way or another. Retired folks, like me, can't afford this yo-yo BS every week or so. I think I'm going to get a little of what I lost back, get out of this market, and go 100% fixed income again. A good 7% or so looks great instead of wondering what this market will do next????
every time the markets drop msn finds some dumb reason. they just will not admit that our economy is going to hell in a hand basket. when obummer & co totally bankrupt the country they will still be blaming china or some other lame excuse.wake up people.
The headline is a bunch of BS. The DOW had already dived well before that along with Gold, Copper, Oil, and energy and mining stocks.
This is the kind of yellow journalism that just makes me sick. Boston had nothing to do with what happened today.
As it was said in "Apocalypse Now" The BS piled up so fast you needed wings to stay above it.
Now, the short-squeezing media f**ks who have been artificially holding up the market have an excuse for profit-taking!
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The idea of US crude being a shelter from turmoil abroad may not be as far fetched as it seems.
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