Stocks Tumbled amid EU Woes
Published on Monday, 25 June 2012 17:01 Written by Christopher Lynn
New York, June 25th (TradersHuddle.com) – Stocks tumbled at the start of the week after European debt woes, coupled with global growth concerns weighed on sentiment and hampered risk appetite in the session. Participants had diminished expectations over the EU summit later in the week.
The Dow Jones Industrial Average lost 138.12 points, or 1.09%. The S&P 500 index fell 21.30 points, or 1.6%, while the NASDAQ tumbled 56.26 points, or 1.95%.
The market started with losses amid weakness in overseas markets on ongoing European debt woes. Participants were not excited over the EU summit later this week, as they do not expect major policy shifts that could help tackle the debt crisis in the region. Spain formally asked for the bank bailout funds and the euro traded lower, as risk appetite waned.
The concerns over Europe and the impacts on global growth spurred fear, with the VIX soaring 11%. The decline was broad based with all of the S&P 500 sectors ending in negative territory. Energy, financials, and technology slumped more than 2%, while utilities and consumer staples posted the smallest declines. In the energy sector, a drop in crude oil prices and concerns over global growth weighed on the sector. Chesapeake Energy (NYSE: CHK) plunged to the bottom of the S&P 500, as shares tumbled 8.5%, despite a jump in natural gas prices as a tropical storm threatened the Gulf of Mexico. The company was once again in a center of controversy amid a report that the company colluded with Encana (NYSE: ECA) to suppress land prices in areas to be thought rich with oil and gas. Shares of Encana fell 4.13%.
Cabot Oil & Gas (NYSE: COG) jumped 1.35%, posting the biggest percentage gain in the energy sector, while Halliburton (NYSE: HAL) dropped nearly 3% after it was downgraded to a Neutral from Buy at Pritchard.
Financials were under pressure, as banks were hit hard in the session after Oppenheimer cut estimates in several of the big players. Bank of America (NYSE: BAC) tumbled more than 4% to $7.60, posting the biggest percentage decline in the Dow Jones Industrial Average. The stock broke below its 50day moving at the $7.78 area after Oppenheimer cut its second quarter estimates below estimates. Rival Citigroup (NYSE: C) tumbled 4.43% after the firm lowered its estimates below consensus, despite it recommended the stock, as it sees particularly compelling.
Morgan Stanley (NYSE: MS), which is seen as the bank with the biggest exposure to Europe plunged 4.7% in the session. Oppenheimer continues to recommend the stock despite less visibility as it presents a compelling valuation.
In tech land, Apple (NASDAQ: AAPL) lost 1.95% to $570.765, closing below its 50day moving average at the $576 area. The stock was under pressure amid broad weakness and after a U.S. Judge in a court in Chicago issued an order, in which it effectively ended a lawsuit between Apple and Motorola Mobility, recently acquired by Google that started in 2010. The U.S. judge wrote in its ruling that neither party was entitled to an injunction.
Struggling rival Research In Motion (NASDAQ: RIMM) plunged 7.6% amid a report that the company is considering to separating out its handset manufacturing business from its messaging network. Meanwhile, Facebook (NASDAQ: FB) lost 3% to $32.06. The stock had surged more than 29% from its record low of $25.52 amid improved sentiment on the name after it announced a new advertising model and launch a new advertising network with Zynga.
Also in the sector, Intel (NASDAQ: INTC) tumbled 3.3% to $26.05 after Evercore Partners issued cautious comments on the name.
Consumer staples outperformed in the day, with Constellation Brands (NYSE: STZ) surging to the top of the S&P 500 index. The stock jumped more than 12% on news that Anheuser-Busch Inbev's buyout of Mexican brewer Grupo Modelo. Constellation is involved on a joint venture with the Corona beer brewer. Meanwhile, Wal-Mart (NYSE: WMT) logged the only gain in the blue chip index, as shares climbed 1.3%.
- Trading Idea: - Is Bank of America close to Resistance?
- How to Play the Building Momentum in Chesapeake Energy
- Apple Is Close to the 50 Day Moving Average
- First Use of Natural Gas to Power Equipment for Hydraulic Fracturing in Northeastern Pennsylvania
- Chesapeake Energy Is Near its 50 Day Moving Average
- Trading Idea: Entry Levels for Apple
- Southwestern Energy Announces Closing Of Acquisition Of Marcellus Shale Properties
- Is Chesapeake Energy Setting for a Break Out?
- Chesapeake Energy Is Near Resistance
- Is Apple Waiting for a Break Out?
Related Partner Headlines
- Cramer Quick Take: The 60-Inch TV Will Be Key This Holiday - TheStreet.com
- Apple, Intel, MicroStrategy: Tech Winners & Losers - TheStreet.com
- What You Can Get on Thursday's Black Friday - TheStreet.com
- Banks Cough Up $26.1 Billion in Mortgage Relief - TheStreet.com
- Bank of America, MBIA Death Match Hurts Both: Moody's - TheStreet.com
- Good Follow-Through - TheStreet.com
- iPhone 5S for Next Year: Rumor - TheStreet.com
- Why Apple's Stock Is an Undeniable 'Buy' Right Now - TheStreet.com
- Citigroup to Slash 300 More Jobs: Report - TheStreet.com
- Bank of America Will Cut to Hit Earnings: Analyst - TheStreet.com
Latest Partner Headlines
Dow Today: Verizon Communications (VZ) Higher - TheStreet.com
Separating the Bargains From the Busts - TheStreet.com
Cramer Quick Take: The 60-Inch TV Will Be Key This Holiday - TheStreet.com
Cramer Quick Take: Cisco Wins If Fiscal Cliff Is Resolved - TheStreet.com
Gap Up and Sit - TheStreet.com
Apple, Intel, MicroStrategy: Tech Winners & Losers - TheStreet.com
Windows 8 PC Sales Disappointing: Report - TheStreet.com
Cramer Quick Take: Buy Home Depot and Lowe's - TheStreet.com
Dow JonesCompany ID [INDEXDJX:.DJI] Last trade:15,307.17 Trade time:4:44PM EDT Value change:▼80.41 (-0.52%)
S&P 500Company ID [INDEXSP:.INX] Last trade:1,655.35 Trade time:4:43PM EDT Value change:▼13.81 (-0.83%)
NASDAQCompany ID [INDEXNASDAQ:.IXIC] Last trade:3,463.30 Trade time:5:15PM EDT Value change:0.00 (0.00%)
In The Wires
Survey Copter Flies to Stratasys for 3D Printing of UAV Systems
Apartment Movers Is Now Offering Indispensable Advice on International Moving Companies With Their New Online Resource
Pressure Release: Valve Manufacturing in Canada Industry Market Research Report Now Available from IBISWorld
Mpact Magic Announces Shockproof Reputation Management System
China Xiniya Fashion Limited Files Annual Report on Form 20-F
Chicago Drain Cleaning Contractors Announce Summer Discount For 10% off Plumbing Service in Chicago, IL
Voice One Will ‘Shatter’ Popular Misnomers About Messaging with a Team of Experts in a Panel Discussion
No Barriers Summit Comes to Telluride, Colorado in August, Providing Outdoor Adventure for People with Disabilities