| Stocks End Lower, Putting Into Jeopardy a Six-Week Winning Streak |
| Feb-07-2013 |
| Keywords: stocks, lower, apple, cash, dollar, euro, productivity, weekly jobless claims |
It was another volatile session on Wall Street today as investors considered disappointing news on the U.S. economy and concerns in the Eurozone.
The Dow Jones Industrial Average recovered from an early triple digit decline to end the session just 42-points lower. Both the Nasdaq Composite and S&P 500 slipped 3-points.
Dollar strength against the euro combined with disappointing reports out of the Labor Department soured the mood of investors.
4th quarter productivity fell 2%, representing the biggest decline in almost two-years. Adding insult to injury, the Labor Department also reported that unit labor costs last quarter jumped 4.5%, well above estimates looking for a 3% increase. The Labor Department also reported that weekly jobless claims last week fell a weaker than expected 5,000, totaling 366,000.
And late this afternoon, the Federal Reserve reported that consumer borrowing in December jumped 6.3% to a total of almost $2.8 trillion. In dollars, borrowing jumped $14.6 billion, with all of the months increased borrowing going towards auto and student loans.
The dollar today rose 1.2% against the euro after European Central Bank President Mario Draghi talked down the currency, saying the central bank would be on the lookout for inflation should the currency continue to rise.
Today's comments out of the ECB initially sparked another flight to safety, but prices stabilized later in the day, with the yield on the 10-year Treasury note holding steady at 1.96%
There was some great news out of retailers. Macy's saw its January same-store sales jump 11.7% from a year ago. Target's results beat expectations as well, with same-store sales climbing 3.1% compared to expectations of a less than 2% increase. And Gap doubled Wall Street estimates, its same-store sales jumping 8% on a year-over-year basis.
A 2.97% jump in the shares of Apple helped to minimize losses on the tech heavy Nasdaq Composite. Apple the focus of much criticism about what it should do with its billions in cash on hand, with by some estimates accounts for 1/3 of the company's more than $429 market cap. David Einhorn's Greenlight Capital is planning to sue Apple and urged company to issue preferred stock paying a 4% dividend in order return cash to investors. Einhorn also revealed a 1.3 million-share long position in Apple. |
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Posted by Lou Dobbs Staff at 11:00 AM Email to a friend |
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