Market Recap: Stocks Take a Dive as S&P Downgrades France
- Posted on January 13, 2012 at 4:44pm by
Becket Adams
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Markets closed down on Wall Street today:
- Dow -0.39 percent
- S&P -0.49 percent
- Nasdaq -0.51 percent
- Oil +0.16 percent
- Gold -0.52 percent
On the commodities front:
- Oil (NYSE:USO) climbed to $99.26 a barrel
- Gold (NYSE:GLD) fell to $1,639.10 an ounce
- Silver (NYSE:SLV) fell 1.44 percent to settle at $29.60
(Related: Talks Over Greek Debt Writedowns Stall as Creditors Disagree on Scope of Losses)
Today’s markets were down because:
1) Downgrades: Ratings agency Standard & Poor’s has downgraded the government debt of France, Austria, Italy and Spain by one notch, but maintained Germany‘s at the coveted “AAA” level. The cuts, which eliminated France and Austria’s triple-A status, deal a heavy blow to the currency union’s ability to fight off a worsening debt crisis. Italy was lowered to BBB+ from A. Spain slipped to A from AA-. The downgrades come as crucial talks on cutting Greece’s massive debt pile appeared close to collapse Friday.
2) Trade: The U.S. trade deficit widened in November as an increase in imports weighed on economic growth, Commerce Department data showed on Friday. Imports rose 1.3 percent as exports fell 0.9 percent. And although a wider trade deficit subtracts from gross domestic product, higher imports are a sign of increased consumer demand within the country.
The Thomson Reuters/University of Michigan preliminary index of consumer sentiment rose in January, suggesting a stronger consumer-spending outlook consistent with the growth in imports. However, as the cooling global economy causes exports to taper off, it will soon have a negative effect on the prospects of a U.S. recovery.
3) Banks: JPMorgan led banks stocks lower, falling as much as 3 percent after the bank announced it earned just 90 cents per share in the fourth quarter, down from $1.12 a year earlier. Citigroup, Morgan Stanley, Bank of America, and Goldman Sachs all declined around 3 percent as well, while Wells Fargo’s, scheduled to report earnings on Tuesday, managed to close the day only slightly in the red. Citigroup is also set to report earnings next Tuesday, while Goldman will report on Wednesday and Bank of America and Morgan Stanley will report on Thursday.
[Editor’s note: portions of the above originally appeared on Wall St. Cheat Sheet.]
The Associated Press contributed to this article.
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Gypsy123
Posted on January 13, 2012 at 9:03pmI don’t mess with stocks have watched too many friends lose their retirement. It is not a good investment to lose your money.
Report Post »seeker9
Posted on January 13, 2012 at 11:32pmI have been in stocks for several years now. With care, it is the only place where an average person can make it big. Most important thing to remember is that it is not a bank account, if you got a reasonable gain, take it. So far, my gains far out-weigh my losses. Apple has been one great investment. One can only expect that Apple will not keep going up like in the past. My risk tolerance is far less now than in the past, so scaled back considerably. Still, I prefer a chance at a 5-10% gain in a week versus 2% at a bank CD.
Report Post »LIBS-ARE-DINGLEHEADS
Posted on January 13, 2012 at 8:54pmOld News. Pros saw this coming months ago. Years.
While we’re on the subject….BLAZE: STOP using idiot words to describe a normal day in the markets.
Down 48 points is NOT a “dive”. using stupid adverbs is simply……stupid.
No wonder people are “scared” to go in the market.
I use this analogy;
You get in an elevator…it has two buttons
One says “Soar”
The other says “Plummet” (common adverbs to describe market action, by mentally challenged editors and writers to grab people’s attention).
Would YOU get into that elevator???
Report Post »LIBS-ARE-DINGLEHEADS
Posted on January 13, 2012 at 8:50pmOld News. Say Blaze: Stop using stupid adverbs when reporting the stock market. “Dive”? Please.
The Dow going down 48 points is NOT “diving”. You show your ignorance when you use idiot words to describe a normal day.
I ask my clients this all the time, when they are scared to go into the market.
It’s like an elevator.
If you got in one, and it had only two buttons;
One said “Soar”
and the other said “Plummet”…..
…would YOU press either? Would YOU stay in?
So…cut it OUT!
Report Post »lukerw
Posted on January 13, 2012 at 7:43pmThat leaves… Germany… as the EU “King” pin!
Report Post »RehabUncleSam
Posted on January 13, 2012 at 7:21pmFrom the main stream media “Nothing to see here folks …….move along now!”
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