S&P 500 falls a fifth day as euro-zone tensions escalate
By Caroline Valetkevitch | September 27, 2012 7:35 AM EST
The S&P 500 fell for a fifth straight trading day on Wednesday as protests in Spain and Greece over euro zone austerity measures raised fresh concerns over Europe's ability to get its debt crisis under control.
Investors sold risk-sensitive sectors such as energy and tech, while they poured money into more defensive areas like utilities and consumer staples. The S&P technology sector <.GSPT> declined 0.8 percent and the energy sector <.GSPE> fell 0.9 percent, while S&P utilities <.GSPU> ended up 0.2 percent.
Violent protests in Madrid against expected austerity measures and growing talk of secession in the wealthy Catalonia region increased pressure on Spanish Prime Minister Mariano Rajoy as he moves closer to asking euro zone policymakers for rescue money.
Meanwhile, Greece faced its biggest anti-austerity protest in more than a year as international lenders admitted to difficulty in working out how to solve Athens' debt crisis.
"When it gets down to it, there is real disagreement between the people in the streets and the policy makers" in Europe, said Tim Ghriskey, chief investment officer of Solaris Group in Bedford Hills, New York.
"I think it's certainly causing some concerns" for investors, he said, adding, "The market's probably looking for an excuse to have a correction."
The S&P 500 is up 5.2 percent so far for the third quarter and 1.9 percent for September, historically a weak month for equities. Gains were largely tied to actions taken by the U.S. Federal Reserve and European Central Bank to prop up their economies.
For the day, the Dow Jones industrial average <.DJI> was down 44.04 points, or 0.33 percent, at 13,413.51. The Standard & Poor's 500 Index <.SPX> was down 8.27 points, or 0.57 percent, at 1,433.32. The Nasdaq Composite Index <.IXIC> was down 24.03 points, or 0.77 percent, at 3,093.70.
Longer term, the outlook for stocks appeared more positive. While the S&P 500 wasn't expected to move much from its current level through the end of the year, according to a Reuters poll of analysts, it should advance in the first half of 2013, largely on central bank actions.
Also weighing on tech shares Wednesday, Jabil Circuit
Other recent earnings warnings from companies including FedEx Corp
Outlooks for the third quarter are at the most negative since 2001, according to Thomson Reuters data. The negative-to-positive ratio for the upcoming earnings period stands at 4.3 to 1.
On the plus side for the day, American Greetings Corp jumped 17.3 percent to $16.82 after the company said it received an offer to go private from a group led by its chief executive, valuing the greeting card company at about $580 million.
Economic data showed prices of new U.S. single-family home sales vaulted to their highest level in more than five years in August, the latest evidence the housing market was making progress.
Volume was roughly 6.54 billion shares traded on the New York Stock Exchange, the Nasdaq and the Amex, compared with the year-to-date average daily closing volume of 6.53 billion, even though many participants were out for the observance of the Jewish holiday of Yom Kippur.
Decliners outnumbered advancers on the NYSE by about 17 to 12, and on the Nasdaq by about 5 to 3.
(Editing by Kenneth Barry and Leslie Adler)
Join the Conversation
- Russia's New Tactical Nuclear Weapons Program Growing Confident Against the US: Talks of World War III
- US To Supply Defensive Lethal Weapons To Kiev – A Vey Alarming Signal, Says Russia
- Travel Alert: New Delta Air Lines Airbuses Could Be Seen In Australia Soon
- Product Recall: Graco Recalls Baby Strollers in Canada, U.S. Due To Amputation Risks
- New Zealand Assured China-Australia Deal Will Not Affect Demand
- New Zealand Medicine Products Sector To Get Own Regulator::Drops Plan For A Joint Regulator With Australia
- Canada's Ontario Students Score High Rank In Global Survey Of Computer Skills