And Halliburton also reported sharply higher earnings on increased activity in North American oil fields that offset Middle East unrest. In earnings news Monday, Citigroup posted a profit of 10 cents per share, a penny ahead of estimates, but net income fell, and the bank said it continues to struggle in terms of growth.Įlsewhere in earnings, Eli Lilly reported profit of 95 cents a share, beating analyst estimates and sending shares of the Illinois drugmaker up. The dollarhowever, was up slightly in part because of pressure on the euro amid concerns that Greece will need to restructure its debt and continuing uncertainty over Portugal's financial health. Silver also closed at a new 31-year-old high of $42.96. Gold prices surged to a new record, closing at $1,493.30, after news of the downgrade in the U.S.'s long-term debt rating. light crude fell 2.3 percent to close at $107.12. London Brent fell 1.5 percent to $121.61 a barrel, while U.S.
Meanwhile, oil prices droppedafter a lack of buyers for crude prompted Saudia Arabia to cut its output. Treasurys surprisingly ended the session higherdespite S&P's rating action. "There's no reason to hit the panic button yet," Kinahan said, adding, "It's natural that the volatility would increase." Kinahan, chief derivatives strategist at TD Ameritrade.Īlso, he noted, while the market has fallen, the S&P 500 is still trading above 1,275, the low end of a range that the market has sustained for awhile. debt, and the fact a number of key earnings reports from financial and tech companies, among others, are due out this week, said J.J. The downdraft in the market, and the spike in volatility, are not surprising given S&P's downgrade of its outlook for U.S. "Savvy money managers have already positioned themselves for potential negative ratings news, or negative ratings period," Greco said. Greco noted that Pimco, the world's largest bond fund, stepped away from US government debt back in March. finances are in dire shape, is not news to many investors and traders. But there also "weren’t many buyers out there to support the market," Greco said.ĭuring a fully staffed session, the market could have fallen more, he said.īut, S&P's message, that U.S. Given the amount of high frequency trading that dominates the market, "were there that many sellers," asks Joe Greco of Meridian Equity Partners. In the final hour of trading Monday, less than 800 million shares had traded hands on the NYSE floor. As a result, many market participants are away, leaving trading desks thinly staffed.
long-term debt as it came during a week marked by both the Passover and Easter holidays. It may be wrong to read too much into the market reaction to S&P's decision to downgrade the outlook for U.S.
The CBOE Volatility Index, widely considered the best gauge of fear in the market, rose about 11 percent to nearly 17, after trading well above 18 earlier in the session.Īll key S&P 500 sectors fell, led by energy and financials. The S&P 500 fell to 1,305, after trading below 1,300 earlier, while the Nasdaq also sank. Most Dow components sank, led by Bank of America, Caterpillar, and was the only stock to gain. The blue-chip index fell 247 points at one point during the session. The Dow Jones Industrial Average fell about 140 points to about 12,201.59, after ending last week slightly lower. Stocks closed down more than 1 percent, although well off the lows of the session, in the wake of news that Standard & Poor's downgraded its outlook on the long-term sovereign debt of the United States to "negative."
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