Economic Jitters Weighed on Stocks

Published on Monday, 30 April 2012 19:49 Written by Todd Shriber

New York, April 30^th (TradersHuddle.com) – Stocks snapped a 4-session winning streak to close the month with a down note. The S&P 500 and the NASDAQ logged a loss for the month of April amid mixed economic reports in the U.S. and news that Spain has slipped into a recession, spurring renewed jitters over its ability to finance its debt.

The Dow Jones Industrial Average lost 14.68 points, or 0.11%. The S&P 500 index fell 5.45 points, or 0.39%, while the NASDAQ slumped 22.84 points, or 0.74%.

The market struggled from the start as futures drifted lower amid weakness in European markets following news that Spain’s GDP shrank 0.3% in the first quarter and as economic data in the U.S. was mixed, with personal income climbing more than expected, while personal spending was weaker than expected.

Later in the morning, the Chicago Purchasing Managers Index declined more than expected to 56.2 in April from 62.2. The index continued to show expansion, but the drop was another data point pointing toward sluggish growth in the U.S. economy, which coupled with euro zone jitters weighed on stocks all day.

Among the S&P 500 sectors, energy and utilities gained, while industrials, materials, and technology logged the biggest losses. Energy saw a boost from shares of Sunoco (NYSE: SUN), which surged more than 20% to $49.29 on news the company will be acquired by Energy Transfer Partners (NYSE: ETP) for a cash and unit transaction that value the company at $50.13 per share, or about $5.3 billion.

The sector also benefiting from natural gas related shares, which gained amid a rally of more than 4% on natural gas prices on news that production dropped 0.6% in February. Range Resources (NYSE: RRC) jumped 4.3% to $66.66, while Chesapeake Energy (NYSE: CHK) gained 4% to $18.44, on higher gas prices and as the stock was upgraded to Outperform from Market Perform at BMO Capital.

On the industrial sector, Caterpillar (NYSE: CAT) was a notable mover, as the stock led the decline in the Dow Jones Industrial Average. Caterpillar fell 1.71% to $102.77 amid economic jitters following global economic jitters.

Also in the blue chip index, Bank of America (NYSE: BAC) weighed on performance, as the lender lost 1.7% to $8.11. BofA was under pressure on concern over sluggish growth in the U.S. economy.

In the technology space, the stakes on the battle for eBooks supremacy increased following news that Microsoft (NASDAQ: MSFT) will invest $300 million in Barnes & Noble’s (NYSE: BKS) digital eBook business unit. The deal will value the unit in $1.7 billion, with Microsoft garnering a 17.6% stake with its investment. Shares of struggling Barnes & Noble soared 51.68% to $20.75 in the session.

Rival Amazon (NASDAQ: AMZN) jumped 2.23% to $231.90, extending the prior session 15% gain following a solid earnings report and on news the company has agreed to begin collecting sales tax in Texas. On Thursday, Amazon reported a profit of $0.28 per share, $0.21 better than consensus, on sales that jumped 33.8% from a year ago period to $13.19 billion. Meanwhile, Apple (NASDAQ: AAPL) tumbled more than 3% to $582.98 amid a sharp selloff in the shares, as participants saw the entrance of Microsoft to the tablet space, through the Nook as a competitive threat.

On other M&A news, Delta Airlines (NYSE: DAL) gained more than 1% in the day amid lower crude oil prices and as it said it has closed a deal to purchase a ConocoPhillips (NYSE: COP) refinery in Pennsylvania for $180 million.

While, Hologic (NASDAQ: HOLX) said it has agreed to buy Gen-Probe (NASDAQ: GPRO) in a deal valued at about $3.75 billion. Shares of Gen-Probe rallied more than 18%, while Hologic plunged nearly 10%.