Stocks Tremble as Investors Fear a Correction Coming
NEW YORK (
The Street) -- Major U.S. markets tumbled Monday as investors remained jittery from last week's weaker-than-expected jobs report, and the prospect that stocks are headed for a correction. Analysts said Tuesday's retail sales report could calm jitters that have been apparent since the onset of the new year.
- The S&P 500 slumped 1.3% to close at 1,819.20, while the Dow Jones Industrial Average dropped 1.1% to 16,257.94. The Nasdaq tumbled 1.5% to 4,113.30.
"The jobs report that came out was a little disappointing; a little surprise," Brad Sorensen, director of market and sector analysis at Charles Schwab, said in a phone interview. "As [the market] started to drift a little lower there was no conviction to buy. I think the market will be watching for the retail sales number tomorrow."
- The December Treasury budget statement showed a surplus of $53.2 billion. Atlanta Fed Bank President Dennis Lockhart spoke Monday, saying that the Federal Reserve scaling back its economic stimulus program will continue so long as the economy continues to improve.
- Fourth-quarter earnings reports in focus this week include banks such as JPMorgan Chase (JPM)and Wells Fargo (WFC) on Tuesday, Bank of America (BAC) on Wednesday, Goldman Sachs (GS) and Citigroup (C) on Thursday, and Morgan Stanley (MS) on Friday.
Beam (BEAM) was the top performer in the S&P, surging 24.6% to $83.42 after Suntory Holdings said it will buy Beam for $13.6 billion in cash. Computer-networking equipment maker Juniper (JNPR) was the second biggest gainer, rising 7.6% to $25.32 after being targeted by activist hedge fund Elliott Management Corp.
Lululemon Athletica (LULU) plunged 16.6% to $49.70 after slashing its current-quarter sales and earnings outlook. Wendy's (WEN) jumped 6.4% to $8.98 after reporting upbeat 2014 guidance and preliminary fourth-quarter earnings driven by same-store sales growth. The company also unveiled a $275 million share buyback program.
- Germany's DAX rose 0.39% while the FTSE was 0.25% higher. The Nikkei closed 0.20% higher while the benchmark Shanghai Composite index shed 0.19% to a five-month low of 2,009.56 after plans by China's securities regulator to tighten its supervision of initial public offerings did little to ease liquidity concerns.
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