YAHOO [BRIEFING.COM]: Stocks
posted sharp losses on Monday as economic concerns and corporate job cuts
continued to weigh on investor sentiment.
Stocks made a recovery attempt
to briefly trade with a gain, but a surge in selling interest in the final
minutes left the S&P 500 near its session low at the close. Trading
action was choppy on below average volume. All ten economic sectors posted a
loss.
In corporate news, Citigroup
(C 8.87, -0.65) announced plans to slash as many as 52,000 jobs
from its workforce, which totaled 352,000 at the end of the third
quarter, in an effort to cut costs due to the financial market
turmoil. Citi has already eliminated 36,000 positions in 2008. The financial
sector was a laggard with a decline of 6.0%.
Lowe's (LOW 19.01, +0.78) topped expectations for
the third quarter, but issued downside earnings guidance for the fourth quarter
after warning that consumers will likely delay discretionary home improvement
and big ticket purchases. The results were better-than-feared following
downside guidance from several retailers last week, resulting in a bounce in
shares of Lowe's.
Target (TGT 31.69, -1.34) reported in-line
earnings, but decided to temporarily suspend its share repurchase program due
to the uncertain economic environment. The retailer also cut its 2009 capital expenditure
forecast by $1 billion. Retailers as a whole fell 2.7%.
The group of twenty finance
ministers, known as the G-20, announced their latest initiatives, but did not
produce any agreements that would alter the near-term picture in any meaningful
way. Among other measures, the G-20 agreed to continue to use fiscal measures
to help stimulate domestic demand and help developing economies gain
access to credit. The G-20 also said there will be more international
cooperation among regulators and that banks will meet stricter standards. For
the next 12 months the G-20 countries will not implement any new trade
barriers.
Economic conditions remain
weak across the globe -- Japan officially fell into a recession for the first
time since 2001, joining the Eurozone.
In U.S. economic news,
industrial production bounced to an increase of 1.3% in October from a decrease
of 3.7% in September. The increase should be seen as temporary as it was in
part due to a recovery in mining (oil) and regional manufacturing output
following hurricanes Gustav and Ike.
The November New York Empire
Manufacturing Index, a regional manufacturing survey, declined to -25.4 from
its October level of -24.6. While the reading reflects contraction in
manufacturing in the New York region, it was slightly better than the -26.0
that economists expected.
Oil futures ($55.01, -3.6%)
traded in a volatile manner, with OPEC cutting its 2009 demand forecast to 30.9
million barrels per day from 31.1 million. OPEC said evidence suggests the
global economy will be weaker than the cartel had previously anticipated.DJ30
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