Stocks Crushed as Wall Street Girds for Fiscal Cliff Battle
The Bureau of Labor Statistics reported that the producer price index fell 0.2% in October after advancing by 1.1% in September. Economists were expecting levels to increase 0.2%.
Excluding food and energy, the index fell 0.2% after being flat in September. Economists predicted an increase of 0.1%.
Also, the Census Bureau said business inventories increased 0.7% in September, which was more than the 0.5% rise expected by economists and August's 0.6% increase.
Sales were strong with a rise of 1.4% compared with a gain of 0.6% in August.The FTSE 100 in London slid 1.11%, while the DAX in Germany closed off 0.94% on Wednesday. Japan's Nikkei average settled up 0.04% and Hong Kong's Hang Seng closed higher by 1.20%. Gold for December delivery rose $5.30 to settle at $1,730.10 an ounce at the Comex division of the New York Mercantile Exchange, while December crude oil contracts closed up 94 cents at $86.32. The benchmark 10-year Treasury lost 1/32, lifting the yield to 1.604%. The dollar was up 0.01%, according to the U.S. dollar index. In corporate news, Abercrombie & Fitch (ANF) shares soared 34.5% after the retailer posted much better-than-expected third-quarter earnings of 87 cents a share and lifted its full-year outlook. AMD (AMD) denied Tuesday that it's on the block following a report that the No. 2 chipmaker could be up for sale. The stock sank 7.7%. Staples (SPLS) posted third-quarter revenue that missed forecasts, driven by tepid sales in Europe and Australia. The office supply chain's earnings per share came in above estimates at 46 cents on revenue of $6.35 billion; analysts expected earnings of 45 cents a share in the October-ended period on revenue of $6.45 billion. The stock gained 2.6%. Mosaic (MOS) shares tumbled 3.3% after the fertilizer producer lowered its fiscal second-quarter potash and phosphates sales volume outlook, citing softer international demand. Facebook (FB) shares popped 12.6% as long-term investors in the social networking giant were reportedly choosing to keep their stakes in the company amid the lockup expiration of the big blocks of insider stock.
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