YAHOO [BRIEFING.COM]: Woes
over the fiscal health of select European nations and some disappointing
jobless claims numbers fueled a selling frenzy that culminated in the market's
worst single-session percentage loss since April.
Concerns for the fiscal health
of Portugal, Greece, and Spain in the wake of some tepid bond auction results
stirred early selling interest, which intensified with news that initial
jobless claims for the week ended Jan. 30 increased more than expected week-over-week
to 480,000. Continuing claims remained steady week-over-week at 4.60 million,
but that was still higher than the consensus call for 4.58 million continuing
claims.
Disappointment over the
headlines led global participants to seek safety in the dollar, which spiked
0.7% to a new six-month high.
Participants wanted little to
do with equities, though. In turn, 97% of the issues listed in the S&P 500
logged a loss, which drove the broad-market measure to its lowest close in
nearly three months. Meanwhile, the Dow Jones Industrial Average dipped below
10,000 for the first time since early November, but settled just above that
psychologically significant line. Cisco (CSCO 23.16, +0.09)
was the only Dow component to book a gain, thanks to its better-than-expected
earnings and strong guidance.
Visa (V 83.05, -0.47) also exceeded earnings
expectations and reaffirmed its outlook for growth, but its shares rolled over
from a strong gain in the early going to join peer MasterCard (MA
222.11, -25.47) in the red. MasterCard missed Wall Street's consensus earnings
estimate for the latest quarter. The stock was one of the weakest names in the
financial sector, which fell 4.2%, worse than any other major sector.
Natural resource plays had
been among the poorest performers for most of the session. Their losses were
linked to broader market weakness and sharp losses in the commodity complex,
which dragged down the CRB Commodity Index to a new three-month low and a 2.6%
loss for the session.
Weakness among commodities was
broad based as oil prices plummeted 5.0% to $73.14 per barrel. Prices haven't
fallen by such a sharp percentage since summer. Meanwhile, gold prices were
pushed 4.3% lower to $1064 per ounce -- December marked the last time that gold
fell by more than 4%.
Volatility spiked amid this
session's sell-off. That resulted in a near 21% rise in the Volatility Index,
which is often dubbed the VIX, or more ominously the Fear Index.
Retailers mostly made up the
handful of names to book gains in the broader market. That was largely the
result of several upbeat same-store sales reports for January. Still, retailers
fell a collective 2.3%.
As if the breadth of this
session's slide wasn't telling enough of conviction, trading volume on the NYSE
came close to 1.5 billion shares, which is well above its 50-day and 200-day
moving average.
While this session's sell-off
will weaken sentiment in the broader market, participants still have yet to see
the latest nonfarm payrolls report, which often brings volatility all on its
own. The nonfarm payrolls report for January is scheduled to be released
Friday morning at 8:30 ET.
Advancing Sectors: (None)
Declining Sectors: Financials (-4.2%), Energy (-3.9%),
Materials (-3.8%), Industrials (-3.1%), Tech (-2.9%), Consumer Discretionary
(-2.9%), Utilities (-2.6%), Health Care (-2.6%), Telecom (-2.4%), Consumer
Staples (-2.3%)DJ30 -268.37 NASDAQ -65.48 NQ100 -2.9% R2K -3.4% SP400 -3.2%
SP500 -34.17 NASDAQ Adv/Vol/Dec 366/2.78 bln/2319 NYSE Adv/Vol/Dec 272/1.48
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