Energy Retreat, Economic Fears Weigh on Wall Street
FOX Business: The Power to Prosper
The Dow closed in the red for the fourth-straight session after sharp declines in the energy complex and lingering economic woes rattled traders' confidence.
Today's Markets
The Dow Jones Industrial Average fell 61.3 points, or 0.5%, to 12,090, the S&P 500 slipped 14 points, or 1.1%, to 1,286 and the Nasdaq Composite fell 30.2 points, or 1.1%, to 2,703. The FOX 50 was off 8.4 points to 901.
A deluge of gloomy economic data, capped with a disappointing non-farm payroll report, set the stage for a broad selloff last week that was extended on Monday. The blue chips are now down 3.8% for the last four sessions -- and have fallen for the last five weeks-- the worst performance August 2010.
The pace of economic data is expected to be considerably slower this week, with no major report on Monday, and a trickling of reports later in the week. Market participants will be paying particularly close attention to weekly jobless claims number on tap for Thursday, which is a timely snapshot of the highly-watched labor market.
Despite the lower reporting velocity this week, many economists are beginning to question whether temporary factors or more serious underlying growth factors are to blame for the recent slowdown in economic activity.
Indeed, Goldman Sachs published a research note this weekend saying a softer underlying growth pace could be at least partially to blame for the recent slowdown.
Energy markets were under pressure on fears a slowing economy may begin cutting into demand. Also of concern to traders are expectations that the Organization of Petroleum Exporting Countries will decide to hike output at its meeting that begins Wednesday.
Equities in the energy sector, such as Halliburton (NYSE:HAL) and Anadarko Petroleum (NYSE:APC), were down sharply as a result.
Light, sweet crude dipped $1.21, or 1.2%, to $99.01 a barrel. Wholesale RBOB gasoline fell 4 cents, or 1.4%, to $2.95 a gallon. Still, oil is up 8.4% from January and gasoline has soared 20.3%.
Consumer gasoline prices have remained in a fairly tight range over the past seven days. A gallon of regular gas costs $3.77 a gallon on average nationwide, down from $3.98 last month, but well higher than the $2.73 drivers paid last year, according to the AAA Fuel Gauge Report.
Metals were largely in the green. Gold was up $4.80, or 0.31%, to $1,547 a troy ounce. Silver soared 59 cents, or 1.6%, to $36.78 a troy ounce.
The greenback recently gained 0.21% against a basket of world currencies, and the euro slipped 0.46% against the dollar.
In corporate news, analysts made two high-profile downgrades Monday.
Wells Fargo (NYSE:WFC) was downgraded to "sell" from "neutral" by Richard Bove of Rochdale Securities, a closely-watched banking analyst. Bove also slashed the price target for the bank to $22 a share from $32.50.
Analysts at JPMorgan cut Lowe's Companies' (NYSE:LOW) to "neutral" from "overweight" and adjusted their price target to $26 a share from $29.
Apple (NASDAQ:AAPL) kicked off its Worldwide Developers Conference on Monday. Chief Executive Steve Jobs, who is on medical leave, presented the keynote, unveiling the technology behemoth's highly-anticipated cloud computing service called iCloud that helps synchronize music, photos and so on for Apple devices connected to the Internet. The technology behemoth also revealed updates to the Mac and mobile operating systems.
Google (NASDAQ:GOOG) and Amazon.com (NASDAQ:AMZN) have already entered the music in the cloud space, but offer products that focus more specifically on music.
Greece has been a major concern for traders in recent weeks. The country is struggling with an enormous public debt load, and there have been concerns raised that it might have to restructure, or worse, default on, its debt if it can't secure an aid package. Such an event, economists say, could have wide-ranging impacts on euro zone economies and could reverberate further west.
Greek Prime Minister George Papandreou is expected to begin publicly lobbying for a second bailout package from the European Union, the International Monetary Fund and potentially private lenders. A key factor in securing the aid, analysts say, is Greece's willingness to take up deeper austerity measures and continue its plan of privatizing government-owned entities in a bid to raise funds.
Corporate News
JPMorgan Chase (NYSE:JPM) tapped Glenn Tilton to run its Midwest business and join its Executive Committee. Tilton had served as Chairman and Chief Executive Officer at UAL and United Airlines prior to joining choice.
Foreign Markets
The English FTSE 100 was up 0.15% to 5,864, the French CAC 40 slipped 0.64% to 3,866 and the German DAX was off 0.25% to 7,091.
In Asia, the Japanese Nikkei 225 tumbled 1.2% to 9,380 and the Chinese Hang Seng dipped 1.3% to 22,950.