MNeagle
24th August 2010, 09:24 AM
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NEW YORK (CNNMoney.com) -- U.S. stocks tumbled more than 1% Tuesday after a report showing existing home sales plunged to historic lows spooked investors.
The Dow Jones industrial average (INDU) sank 127 points, or 1.2%, the S&P 500 (SPX) lost 14 points, or 1.3%, and the Nasdaq (COMP) composite fell 34 points, or 1.5%, at the opening bell.
"Economic reports have been close to disastrous," said Joseph Saluzzi, co-head of equity trading at Themis Trading. "People are very concerned about the economy and everyone is talking about a double-dip [recession] at this point."
Wall Street struggled through a choppy session Monday, with stocks finishing lower as ongoing worries about the global economy pushed excitement about deal-making talks to the backburner.
The disappointing economic news has sent investors flocking to the perceived safety of Treasurys and the Japanese yen, which hit a 15-year high against the dollar early Tuesday.
Economy: The National Association of Realtors said existing home sales plummeted 27% last month, marking the lowest sales pace since NAR began tracking the figure in 1999.
Meanwhile, a report released Tuesday showed that disagreements among the 17 key Federal Reserve officials about how to handle the economy peaked at a meeting earlier this month, according to The Wall Street Journal.
Currencies, bonds and commodities: The dollar fell to a 15-year low against the Japanese yen, but climbed against the euro and the British pound.
"The yen is extremely strong, giving people real concern about our economy," said Saluzzi. "And with the 10-year yield this low, it shows people are really willing to put their money into Treasurys. All of this together means the risk trade is definitely off."
Treasury yields have been holding near historic lows recently as economic jitters have boosted the appeal of so-called "safe" investments such as government-backed debt.
The U.S. Treasury will offer $37 billion worth of 2-year notes on Tuesday.
In other markets, oil futures for October delivery fell $1.09 to $72.01 a barrel. Gold for December delivery added $2.30 to $1,230.80 an ounce.
World markets: European shares sank in afternoon trading. The CAC 40 in France fell 2%, Britain's FTSE 100 lost 1.8%, and the DAX in Germany fell 1.7%.
Asian markets ended mixed. Japan's benchmark Nikkei index ended down 1.3% and the Hang Seng in Hong Kong fell 1.1%. But the Shanghai Composite edged up 0.4%.
Companies: Barnes & Noble (BKS, Fortune 500), which put itself up for sale earlier this month, posted a quarterly loss that widely missed expectations and said same-store sales fell in the first quarter.
Shares of the bookseller dropped more than 2.5% in early trading.
money.cnn (http://money.cnn.com/2010/08/24/markets/markets_newyork/index.htm?section=money_markets&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+rss%2Fmoney_markets+%28Market s%29)
NEW YORK (CNNMoney.com) -- U.S. stocks tumbled more than 1% Tuesday after a report showing existing home sales plunged to historic lows spooked investors.
The Dow Jones industrial average (INDU) sank 127 points, or 1.2%, the S&P 500 (SPX) lost 14 points, or 1.3%, and the Nasdaq (COMP) composite fell 34 points, or 1.5%, at the opening bell.
"Economic reports have been close to disastrous," said Joseph Saluzzi, co-head of equity trading at Themis Trading. "People are very concerned about the economy and everyone is talking about a double-dip [recession] at this point."
Wall Street struggled through a choppy session Monday, with stocks finishing lower as ongoing worries about the global economy pushed excitement about deal-making talks to the backburner.
The disappointing economic news has sent investors flocking to the perceived safety of Treasurys and the Japanese yen, which hit a 15-year high against the dollar early Tuesday.
Economy: The National Association of Realtors said existing home sales plummeted 27% last month, marking the lowest sales pace since NAR began tracking the figure in 1999.
Meanwhile, a report released Tuesday showed that disagreements among the 17 key Federal Reserve officials about how to handle the economy peaked at a meeting earlier this month, according to The Wall Street Journal.
Currencies, bonds and commodities: The dollar fell to a 15-year low against the Japanese yen, but climbed against the euro and the British pound.
"The yen is extremely strong, giving people real concern about our economy," said Saluzzi. "And with the 10-year yield this low, it shows people are really willing to put their money into Treasurys. All of this together means the risk trade is definitely off."
Treasury yields have been holding near historic lows recently as economic jitters have boosted the appeal of so-called "safe" investments such as government-backed debt.
The U.S. Treasury will offer $37 billion worth of 2-year notes on Tuesday.
In other markets, oil futures for October delivery fell $1.09 to $72.01 a barrel. Gold for December delivery added $2.30 to $1,230.80 an ounce.
World markets: European shares sank in afternoon trading. The CAC 40 in France fell 2%, Britain's FTSE 100 lost 1.8%, and the DAX in Germany fell 1.7%.
Asian markets ended mixed. Japan's benchmark Nikkei index ended down 1.3% and the Hang Seng in Hong Kong fell 1.1%. But the Shanghai Composite edged up 0.4%.
Companies: Barnes & Noble (BKS, Fortune 500), which put itself up for sale earlier this month, posted a quarterly loss that widely missed expectations and said same-store sales fell in the first quarter.
Shares of the bookseller dropped more than 2.5% in early trading.
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