NEW YORK, Feb. 8, 2010
Stocks Down Sharply; Dow Back Below 10,000
Selloff in Financial Sector Leads Key Index to Close at 9,908, Its Lowest Level in Months
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The Dow Jones Industrial Average fell below the 10,000 mark Feb. 8, 2010 for the first time in three months. (AP / CBS)
Shares of big banks pulled the market lower, extending a slump that has led to four straight weekly losses.
Mounting deficits in weaker European economies including Greece, Portugal and Spain have raised questions about the health of the global financial system.
Greece's finance minister said Monday the government is preparing to boost some taxes to shore up its finances. But civil servants opposed to cutbacks have pledged to strike on Wednesday.
The questions about finances in Europe are only the latest blow to investor confidence. The market began to stumble in mid-January after China announced plans to contain economic growth and as the Obama administration proposed rules to restrict trading by large financial institutions.
That interrupted a 10-month climb in stocks, which hit 12-year lows last March. The Dow is down 817 points, or 7.6 percent, since closing at a 15-month high of 10,725.43 on Jan. 19.
Brett Hryb, a portfolio manager with MFC Global Investment Management in Toronto, said the latest concern is that the financial troubles in a country like Greece, whose economy is small compared with the rest of Europe, will spill into other countries.
"Clearly Greece itself is nothing. It's just a blip. It's what the contagion could be," he said.
According to preliminary calculations, the Dow fell 103.84, or 1 percent, to 9,908.39. On Thursday, the Dow traded below the psychological barrier of 10,000 for the first time since November. It hadn't closed below that mark since Nov. 4.
The broader Standard & Poor's 500 index fell 9.45, or 0.9 percent, to 1,056.74, while the Nasdaq composite index fell 15.07, or 0.7 percent, to 2,126.05.
Bond prices were mixed. The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose to 3.58 percent from 3.57 percent late Friday.
The dollar fell against other major currencies, while gold rose.
Crude oil rose 70 cents to settle at $71.89 per barrel on the New York Mercantile Exchange.
Jerry Webman, chief economist at OppenheimerFunds Inc., said he doesn't expect that problems with rising debt loads in Europe will cascade into other parts of the world's economy, but he remains cautious.
"Right now, when anybody says the word 'contained' I start to tremble," he said, referring to his skepticism about those who downplay worries about Greece.
Webman is also concerned by the shrugs that have greeted corporate earnings reports. Three out of four of the companies in the S&P 500 index that have reported results for the fourth quarter have posted stronger sales and profit numbers than analysts forecast, according to Thomson Reuters.
"The market is obviously not that enthusiastic about these good bottom-line and good top-line numbers," Webman said, adding that he sees that as a reason to be concerned about the direction of stocks.
In earnings news, the toymaker Hasbro Inc. said its profit surged 77 percent in the fourth quarter while drugstore chain CVS Caremark Corp. said its earnings rose 11 percent. The results beat analysts' estimates.
Hasbro jumped $3.91, or 12.7 percent, to $34.71, while CVS rose $1.65, or 5.3 percent, to $32.72.
Three stocks fell for every two that rose on the New York Stock Exchange, where volume came to 1.1 billion shares compared with 1.6 billion Friday.
The Russell 2000 index of smaller companies fell 6.49, or 1.1 percent, to 586.49.
Britain's FTSE 100 rose 0.6 percent, Germany's DAX index gained 0.9 percent, and France's CAC-40 rose 1.2 percent. Earlier, Japan's Nikkei stock average fell 1.1 percent.
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- Obamanomics....change you can count on!
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- Stick it to the man Yeah!
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- Here is a stock market tip.... invest in those companies whose businesses are least affected by the incompetence of the federal government!
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- 50 years ago a statement like that might have been considered treason.I miss the good old days. Got a lot of family that shed blood for this land. Government worked pretty good until republicans had their run.
- You guys want a balance budget then Kill the Military and Medicare. We would have the budget balnaced within a year
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- Medicare is a problem only because the government has used the Medicare trust fund as a slush fund to fund other programs year after year. Medicare would have surpluses if government could keep its hands of the money. Using your argument, get rid of welfare, food stamps, and medicaid and we can balance the budget. Unlike Medicare where people contributed throughout their working years, the people who collect welfare, food stamps, and medicaid have not paid for their benefits. Taxpayers pay for their benefits and most taxpayers work for a living.
- There is an email going around which advises people to look at the labels, and if all things are equal, buy the item made in America. The author discovered that many stores carry different brands of the same or similar items. He suggests that if the specifications and price are similar, buy the item made in America. It is obvious that the government, manufacturers, and wall street aren't going to bring jobs back to America. However, we as Americans, might be able to preserve and create jobs in America by buying goods made in America. Lets use our buying power to send a message to the government, manufacturers, and wall street.
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- I look at the label now and I buy made in USA when I can. I like products with economies similar to ours and do buy their products. I went looking for a made in USA grill this past summer. Couldn't find a single one in the stores so I repaired the old one. All of them were made in china. It's not that I have anything against the Chinese people but I do have a problem with American corporations moving off shore to take advantage of desperation in other labor markets. Looks like I may have to learn to sew now.
- You didn't look very hard for a made in USA grill, here's 2 of them:
http://www.makgrills.com/
http://www.horizonbbqsmokersstore.com/servlet/StoreFront
The Weber Silver line is also supposed to be still made in USA but you have to be very careful in dealing with Weber grill products. For starters there's a difference between a Weber Grill that's sold in a Big Box store like a Home Depot and a Weber Grill sold in your corner hardware store - the big box grill is inferior construction, steel is thinner, the grills are smaller in diameter, burner assemblies are different, etc. Standard Weber repair parts often will not fit as these grills are custom-made for the big box retailer. Also the Made in USA label is misleading at a big box store because Weber will do things like have the grills for the big box retailer be made of Chinese-made cheap parts shipped to the US and assembled here - as long as final assembly occurs here they can legally put Made in USA on their marketing label.
The big boxers also like to do some misleading, they will put a Weber Silver next to a Spirit, the Spirit is 100% made in China and the Silver is USA, so the customer assumes both grills are made in USA.
Take a look at this site:
http://www.stillmadeinusa.com/garden.html
several grills there.
- Stocks Down Sharply; Dow Back Below 10,000 ................
With the record drop in unemployment rate to 9.7 percent the Dow was suppose to be surging right now. They apparently can't take the hint. Go figure? - Reply to this comment
- Quick! Get them some US jobs to export or some books to cook!
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- Quit whining about your stock losses. Buying stocks is the same as dropping your dimes in the slots at Vegas.
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Do what I do... Invest in Beans, Bullets, Bandaids and Bullion. They never lose value... just keep appreciating. - Reply to this comment
- Whatever wealth Obama cannot steal or redistribute - he intends to destroy with his mouth.
It is time for the second American revolution against tyranny. - Reply to this comment
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- I assume that you're still swallowing the tired old line that there's a difference between the Republican Thieves Club and the Democrat Liars Club.
- Thanks you democrat politicians, especialy Barney Frank, Christopher Doddie, and Obama for ruining my retirement. You sick freaks.
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- You should be thanking the corporate fascists that have hijacked our government, while they move out of our country, take our jobs with them, taking our economic vitality and hidden assets, then turn around and wave the flag while tossing a bible at you.
If you dessent, then you are labeled a communist and harassed like the senators at the health summits.
No, its not the democrats, its half of congress and the lobbists behind them. Its the insurance companies who are making absurd profits, its the doctors behind the push not to change, its the telecommunications, banking and military industrial complex.
Its not the America we knew.
- You should be thanking the corporate fascists that have hijacked our government, while they move out of our country, take our jobs with them, taking our economic vitality and hidden assets, then turn around and wave the flag while tossing a bible at you.
