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Dow, S&P dip on banks, energy

This article was posted on Dec 3, 2009 and is filed under Market News

NEW YORK (Reuters) – The Dow and S&P slipped on Wednesday, pressured by the financial and energy sectors, although the Nasdaq rose on positive news on online retailers such as Amazon.

Investors also weighed mixed news on the labor market.

Stocks pared early gains on concerns that bank profits could be hurt by derivatives legislation under consideration.

“We’re still seeing some relative softness in the financial sector. We have these lingering concerns with their assets,” said Steve Goldman, market strategist at Weeden & Co. in Greenwich, Connecticut.

JPMorgan Chase & Co (NYSE:JPM – News) said it could see its revenue fall by as much as $3 billion in a “worst case” scenario under the legislation, according to a note from Sanford C. Bernstein to investors. Shares of JPMorgan, a Dow component, fell 1.6 percent to $41.56.

In mixed news on the labor market, considered one of the biggest headwinds facing a recovery, U.S. private employers shed 169,000 jobs in November, according to the ADP National Employment private sector survey.

While the number was fewer than the 195,000 jobs cut in October, the ADP report was worse than expected.

“The report wasn’t as good as expected, but it still shows job losses continuing to slow,” said Alan Gayle, senior investment strategist at RidgeWorth Investments in Richmond, Virginia. “That makes us more optimistic about Friday’s employment report and the labor market in general.”

The Dow Jones industrial average (DJI:^DJI – News) fell 38.02 points, or 0.36 percent, to 10,433.56. The Standard & Poor’s 500 Index (^SPX – News) slipped 2.78 points, or 0.25 percent, to 1,106.08. The Nasdaq Composite Index (Nasdaq:^IXIC – News) gained 4.25 points, or 0.20 percent, to 2,180.06.

Reflecting investors’ concerns about the banking sector, an S&P index of financial stocks (^GSPF – News) slipped 0.5 percent. The Keefe Bruyette & Woods index of bank stocks (Philadelphia:^BKX – News) declined 0.2 percent.

January crude oil futures lost 2.5 percent, or $1.97, to $76.40 per barrel after U.S. government inventory data showed a surprising build in crude and gasoline stockpiles.

The unexpected increase in energy supply prompted investors to unload some energy companies’ shares, pushing the S&P Energy index (SNP:^GSPE – News) down 1.1 percent and making it the worst performer among S&P sectors. Occidental Petroleum (NYSE:OXY – News) shed 1.6 percent to $80.88 and Exxon Mobil (NYSE:XOM – News) dropped 0.9 percent to $75.37.

Amid continued questions about retailers’ strength in the holiday shopping season, online vendors were strong performers after analytics firm comScore said that Cyber Monday sales were up 5 percent from the previous year.

Shares of Amazon.com (NasdaqGS:AMZN – News) jumped 1.9 percent to $141.15 on Nasdaq.

On the economic front, investors await the Federal Reserve’s periodic Beige Book survey of regional U.S. economic conditions. The report is set for release at 2 p.m. EST.

(Reporting by Ryan Vlastelic; Additional reporting by Caroline Valetkevitch; Editing by Jan Paschal)

source: yahoo finance

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