YAHOO [BRIEFING.COM]: Efforts to reduce risk in response to eurozone concerns put pressure on crude oil prices. A
corresponding advance by the dollar made the commodity’s slide easier. Oil
prices fell to a pit session low of $87.46 per barrel in late morning action.
That also made for a new 2012 low for the July contract. Crude then spent
the remainder of its session trading in a consolidative pattern and settled
with a 3.2% loss at $87.84 per barrel.
Natural gas prices were also cut down aggressively. The energy
component dropped to a floor session low of $2.39 per MMBtu,
but an attempt to recover took it to a session high of $2.47 per MMBtu. Failure to sustain the move left prices to finish
pit trade with a 2.4% loss at $2.42 per MMBtu.
Gold and silver both began pit trade in negative territory, setting
respective session lows of $1530.40 per ounce and $27.35 per ounce in morning
action. However, a want for safety helped propel prices of the precious metals
of the red, despite the dollar’s advance. Gold settled 1.0% higher at $1563.90
per ounce, just below its session high of $1565.10 per ounce. Silver touched a
session high of $28.12 per ounce moments before it settled floor trade at
$27.99, or 0.9% higher.
Renewed worries about the health and fate of the eurozone brought about a negative tone that permeated trade
for the entire session.
The possibility of European bank recapitalizations offered only
temporary relief to market participants focused on the precarious fiscal,
financial, and economic conditions in the eurozone
periphery, where debt yields were forced higher. Selling among the region’s
major bourses resulted in sizable losses, including a 1.4% loss for the EuroStoxx 50. The euro also took a tumble, such that it set
a near two-year low of less than $1.24. As of the closing bell it had fallen
0.9% against the greenback.
An interest in safety spurred demand for
Gold garnered buying interest after it had spent early pit trade in
negative territory. The yellow metal set a session low of $1530.40 per ounce,
but the appeal of its safety features helped propel the precious metal to $1563.90
per ounce for a 1.0% gain in the face of a stronger dollar. In contrast, the
greenback’s gain seemed to make oil’s slide a little easier. Oil prices fell to
a 2012 low of $87.46 per barrel before they settled with a 3.2% loss at $87.84
per barrel.
The combination of sharply lower oil prices and broad weakness
among equities resulted in outsized losses for Energy stocks. The sector
slumped to a 3.0% loss, which is worse than what any other sector suffered. Oil
and gas equipment, exploration, drilling, and services stocks were all caught
up in the sell-off.
Financials also fell hard. The sector’s 2.2% loss was driven by
weakness among banking plays and diversified financial services issues. SLM Corp (SLM 14.04, +0.36) was one
of the few Financial plays to attract buying interest
– the stock’s gain followed news that the company has earmarked an additional
$400 million for share repurchases.
Monsanto (MON
76.41, +1.66) also managed to muster an impressive gain following the firm’s
latest financial forecast. The rest of the Materials sector suffered a 1.7%
loss.
Telecom stocks did the best job of resisting selling pressure. The
sector’s 0.6% loss was less than what any other sector suffered. The sector’s
relative strength is consistent with its performance in 2012 – Telecom stocks
are up nearly 7% this year, whereas the broad market is up little more than 4%.
Amid such widespread weakness the Volatility Index made a
double-digit percentage spike that took it up near 24. The Fear Gauge’s
multi-month high remains at 25, which was set a couple of weeks ago when stocks
were at multi-month lows.
A want for safety sent Treasuries up sharply, such that the yield
on the benchmark 10-year Note dropped to a record low narrowly above 1.60%.
The only item on the economic calendar featured pending home sales,
which dropped during April by 5.5% when a 0.6% increase had been broadly
expected.
The flow of economic data picks up tomorrow with the release of the
second reading on first quarter GDP, weekly initial jobless claims, and the
latest monthly ADP Employment Change. Friday will bring the official monthly
payrolls report.
Advancing Sectors:
None
Declining Sectors: Telecom
-0.6%, Health Care -0.7%, Tech -0.7%, Utilities -0.8%, Consumer Staples -0.9%,
Consumer Discretionary -1.6%, Materials -1.7%, Industrials -1.7%, Financials
-2.2%, Energy -3.0%DJ30 -160.83 NASDAQ -33.63 NQ100 -0.8% R2K -2.0% SP400 -1.9%
SP500 -19.10 NASDAQ Adv/Vol/Dec 536/1.64 bln/2004
NYSE Adv/Vol/Dec 396/766 mln/2627