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Dow closes below 13,000 for first time in a month
Source: Agencies |
April 10, 2012, Tuesday
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Print Edition
INVESTORS had a three-day weekend to brood over disappointing job growth in March. When they got back to work yesterday and delivered their verdict, it wasn't good.
Stocks closed sharply lower, sending the Dow Jones industrial average and the Standard & Poor's 500 index to only their second four-day losing streak this year.
The Dow finished down 130.55 points at 12,929.59, its first close below 13,000 since March 12. The S&P ended the day off 15.88 points at 1,382.20. The Nasdaq composite closed down 33.42 at 3,047.08.
The Dow and S&P had four consecutive trading days of declines at the end of January, but the losses then were smaller. The Dow lost 124 points over that stretch. It has lost about 330 this time.
Stocks had their best first quarter since 1998 but have stumbled in April. Last week, the Federal Reserve suggested that it is disinclined to take further steps to help the economy, and the European debt crisis flared in Spain.
Then on Friday, with the stock market closed for Good Friday, the government said the country added just 120,000 jobs in March, half the pace from December through February.
After a long weekend to think it over, investors sold stocks broadly. All 10 industry groups in the S&P 500 fell yesterday, with financial stocks the worst performers. Bank of America fell 3.2 percent, and Citigroup was off 2.4 percent.
Of the 30 stocks that make up the Dow, only two, McDonald's and Hewlett-Packard, finished higher. Traders at least didn't sell in great numbers: Volume on the New York Stock Exchange was 3.1 billion shares, the lightest in almost a month. Most school districts in New York and New Jersey are closed this week for spring week.
Investors bought bonds, sending the yield on the benchmark 10-year Treasury note to 2.04 percent, down 0.02 percentage point from Friday. Yields also fell for longer-term U.S. bonds.
Rex Macey, chief investment officer at Wilmington Trust Investment Advisors, cautioned that the jobs report reflected only one disappointing month. Like a doctor, he said, "I'd order up more tests before declaring this as a trend."
The next test will come quickly. Alcoa, the aluminum company, reports its first-quarter earnings Tuesday, the first of the Dow 30 to weigh in. Two major banks, JPMorgan Chase and Wells Fargo, report Friday.
Analysts are expecting quarterly earnings to decline slightly compared with a year earlier. That would break a streak of nine quarters of earnings growth since 2009.
Elsewhere yesterday, the price of crude oil fell 1.9 percent, and gold and platinum rose a little less than 1 percent. The euro rose to US$1.3116 late yesterday, up about two-tenths of a penny from Friday.
Among other stocks making moves:
- AOL shot up 43 percent after the company agreed to sell hundreds of patents and patent applications to Microsoft for a little more than US$1 billion. The company plans to return some of the cash to shareholders.
- Avon fell 3.1 percent after the struggling beauty products company named a former executive at Johnson & Johnson, Sherilyn McCoy, to be its CEO. Investors read it as a signal that Avon will fend off acquisition overtures.
Stocks closed sharply lower, sending the Dow Jones industrial average and the Standard & Poor's 500 index to only their second four-day losing streak this year.
The Dow finished down 130.55 points at 12,929.59, its first close below 13,000 since March 12. The S&P ended the day off 15.88 points at 1,382.20. The Nasdaq composite closed down 33.42 at 3,047.08.
The Dow and S&P had four consecutive trading days of declines at the end of January, but the losses then were smaller. The Dow lost 124 points over that stretch. It has lost about 330 this time.
Stocks had their best first quarter since 1998 but have stumbled in April. Last week, the Federal Reserve suggested that it is disinclined to take further steps to help the economy, and the European debt crisis flared in Spain.
Then on Friday, with the stock market closed for Good Friday, the government said the country added just 120,000 jobs in March, half the pace from December through February.
After a long weekend to think it over, investors sold stocks broadly. All 10 industry groups in the S&P 500 fell yesterday, with financial stocks the worst performers. Bank of America fell 3.2 percent, and Citigroup was off 2.4 percent.
Of the 30 stocks that make up the Dow, only two, McDonald's and Hewlett-Packard, finished higher. Traders at least didn't sell in great numbers: Volume on the New York Stock Exchange was 3.1 billion shares, the lightest in almost a month. Most school districts in New York and New Jersey are closed this week for spring week.
Investors bought bonds, sending the yield on the benchmark 10-year Treasury note to 2.04 percent, down 0.02 percentage point from Friday. Yields also fell for longer-term U.S. bonds.
Rex Macey, chief investment officer at Wilmington Trust Investment Advisors, cautioned that the jobs report reflected only one disappointing month. Like a doctor, he said, "I'd order up more tests before declaring this as a trend."
The next test will come quickly. Alcoa, the aluminum company, reports its first-quarter earnings Tuesday, the first of the Dow 30 to weigh in. Two major banks, JPMorgan Chase and Wells Fargo, report Friday.
Analysts are expecting quarterly earnings to decline slightly compared with a year earlier. That would break a streak of nine quarters of earnings growth since 2009.
Elsewhere yesterday, the price of crude oil fell 1.9 percent, and gold and platinum rose a little less than 1 percent. The euro rose to US$1.3116 late yesterday, up about two-tenths of a penny from Friday.
Among other stocks making moves:
- AOL shot up 43 percent after the company agreed to sell hundreds of patents and patent applications to Microsoft for a little more than US$1 billion. The company plans to return some of the cash to shareholders.
- Avon fell 3.1 percent after the struggling beauty products company named a former executive at Johnson & Johnson, Sherilyn McCoy, to be its CEO. Investors read it as a signal that Avon will fend off acquisition overtures.
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