Sovereign Debt Jitters Dragged Down Stocks. SP500 Laggards: NDAQ, EK, NEM, MEE, WFC

Published on Monday, 08 February 2010 18:38 Written by Christopher Lynn

New York, February 8th (TradersHuddle.com) – Stocks fell, with the Dow Jones Industrial Average finishing below the psychological level of 10,000. Concern that the deteriorating European government deficits will derail economic growth overshadowed good corporate earnings and analysts’ upgrades. Financials and commodities sold-off amid risk aversion.

The Dow Jones Industrial Average fell 103.84 points, or 1.04%. The S&P 500 index lost 9.45 points or 0.89%, while the NASDAQ slid 15.07 points or 0.70%. Market breadth was negative. On the NYSE, decliners topped winners by a rate of 7 to 4. On the NASDAQ, losers outpaced advancers by a rate of 9 to 5.

The market fluctuated early in the trading session, as investors mulled over better than expected corporate earnings reports, analyst upgrades, and concerns that the continued government deficits in Greece, Spain and Portugal will derail the global economic recovery. As the trading session wore off, selling pressure increased and the Bears took over.

European finance ministers tried to reassure Group of Seven leaders that the debt situation there is under control but it hasn't been as easy convincing investors, who are backing away from riskier bets.

The sell-off was broad based, with only Home Depot (NYSE:HD) and Hewlett-Packard (NYSE:HP) as the 2 Dow components that finished higher. Home Depot (NYSE:HD) posted the biggest percentage gain in the blue chip index after Morgan Stanley raised its rating on the stock to "overweight" and added it to its "Best Ideas List." The analysts cited that the margins at the home improvement retailer should benefit as housing begins its recovery.

The S&P 500 Financials Index dropped 2.2% for the biggest decline among 10 industries. Bank of America (NYSE:BAC) lost 3.47%, as the biggest U.S. lender led the Dow lower.

The Nasdaq OMX group (NASDAQ:NDAQ) posted the biggest decline in the S&P 500, tumbling 3.99% to $18.05. The parent of the NASDAQ market beat analyst expectation by a penny, as its profit fell 28%. The shares were under pressure as the exchange operator projected higher-than-expected costs this year.

Eastman Kodak (NYSE:EK) posted the second biggest loss in the broad market index, as shares lost 3.95% to $5.84. The imaging company was under pressure as there was an unfavorable article in Barron’s over the weekend.

The third worst stock in the S&P 500 index was Newmont Mining (NYSE:NEM), as shares of biggest gold miner lost 3.94% to $44.41. The miner is a more leveraged way to invest in gold struggled with the broader equities, despite a Gold’s relief rally.

The fourth largest decline in the S&P 500 was Massey Energy (NYSE:MEE), as shares of the Virginia based coal producer slid 3.65% to $38.26. The company was cited by regulators for potential safety concerns in West Virginia

The fifth worst stock in the broad market index was Wells Fargo (NYSE:WFC) after shares of the maker of bank fell 3.61% to $26.43. Wells Fargo was dragged down by the whole financial sector, as investors’ shied away of riskier assets.