Dow Claws Back Above 10,000; S&P Closes Up
NEW YORK (TheStreet) -- The Dow managed to recapture the 10,000 level in the last hour of trading after wiping away its steepest losses Tuesday, though stocks still finished near the flat line amid uncertainty about global growth.
After being down around 200 points during a good part of the session, the Dow Jones Industrial Average finished 23 points lower, or 0.2%, to 10,044. But the S&P 500 eked out a fractional gain to close at 1074. The Nasdaq dipped 3 points, or 0.1%, at 2211.
"Equity markets thrive when there's certainty, and clearly we don't have that right now. There's a sense that once we have more clarity, we'll be able to see that we're going to get through this and that we'll be OK," said Mike Schenk, senior economist at the Credit Union National Association. "Now, I'm not saying that European debt issues won't drag on U.S. economic growth. I think it'll have an effect and it'll be a noticeable effect, but it won't be devastating."What you're seeing today is really being driven by Europe, but all the U.S. data we're getting is showing that consumers are in a much better place, and even the housing market is in a better place -- and that's what's pulls us out of downturns. I'm not saying the data is being ignored, but the emphasis is in other places," Schenk said, adding, "Once the market gets more clarity, I think the data we've been seeing will help the market stabilize." Several factors weighed on market sentiment Tuesday, including a warning from European Union Economy Commissioner Olli Rehn that major reforms are needed otherwise EU growth will not top 1.5% and the jobless rate will remain high over the next five years. North Korea has threatened to use military action in retaliation against South Korea if it continues to trespass into its waters, and a North Korean spokesman said the Communist country is severing all relations with South Korea, Reuters reports. Earlier, Asian markets staggered under a Yonhap news agency story that referenced a local report indicating that North Korea is preparing for war. Tensions between North and South Korea have been running particularly high after the recent sinking of a South Korean warship. Germany may extend its recently announced short-selling ban to all German companies' stocks, according to a report. In Spain, four saving banks announced plans to merge amid concerns over solvency in the sector. Overseas on Tuesday, Hong Kong's Hang Seng lost 3.5%, and Japan's Nikkei fell 3.1%. The FTSE in London lost 2.5%, and the DAX in Frankfurt dropped 2.3%.
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