Dow Slips as Dollar Gains
NEW YORK (
) -- Stocks finished mostly lower on Monday after new concerns about eurozone debt drove the dollar higher, pushing investors toward gold and commodities.
The
Dow Jones Industrial Average
closed down 37 points, or 0.3%, to 11,406. The
S&P 500
was off by 2 points, or 0.2%, to 1223, while the
Nasdaq
closed higher by a point at 2580.
Boeing
(BA) - Get Report
was the Dow's biggest laggard, followed by
Home Depot
(HD) - Get Report
and
Travelers
(TRV) - Get Report
.
The Dow's best-performers included
Hewlett-Packard
(HPQ) - Get Report
,
DuPont
(DD) - Get Report
and
Bank of America
(BAC) - Get Report
.
The dollar gained value against the euro amid concerns about Ireland's ability to shrink its budget deficit. The dollar index was rising 0.6% while the euro shed 0.8% against the dollar to $1.3918.
Ireland's woes also weighed on European stocks. London's FTSE lost 0.4%, and Frankfurt's DAX shed 0.05%. The better-than-expected U.S. jobs report boosted stocks in Asia. Japan's Nikkei soared 1.1% while Hong Kong's Hang Seng increased 0.4%.
The major U.S. indices finished the event-filled previous week at fresh two-year highs after Republicans won the House; the Fed's plan to buy $600 billion of long-term securities; and better-than-expected job growth in October.
"The declaration by the Fed to give the markets what they want (more money) takes away from the long-term analysis of stocks -- earnings and revenue growth," said Paul Nolte, managing director at Dearborn Partners, in a recent note. "The financial markets may be volatile in the short term as investors try to figure out what the 800-pound gorilla (the Fed) is going to do next. Bonds have been just as volatile as stocks for many of the same reasons; however, there remains some value in high quality bonds with seven to 10 years to maturity."
The benchmark 10-year Treasury note was lower by 6/32 with a yield of 2.559%.
Thursday marks the beginning of a
two-day G-20 summit in South Korea that could impact the U.S. dollar. Leaders in emerging-market countries have criticized the Fed's plan because their local currencies have gotten a boost from increased fund flows. The U.S. is expected to use the meeting to pressure China to revalue its currency.
World Bank President Robert Zoellick suggested a global cooperative monetary system that would link currencies to gold, according to a
Financial Times
report.
|
Consumers cut debts by nearly $1 trillion since 2008's third quarter, according to the New York Federal Reserve Bank's household debt and credit report. Household delinquencies are down 8.2% since 2009's third quarter.
"Consumer debt is declining but only part of the reduction is attributable to defaults and charge-offs," said Donghoon Lee, senior economist at the New York Fed's research and statistics group, in the release. "Americans are borrowing less and paying off more debt than in the recent past. This change, which we continue to study carefully, can be a result of both tightening credit standards and voluntary changes in saving behavior."
A presidential panel set up to investigate the causes of the
BP
(BP) - Get Report
oil spill found that financial interests did not take precedence over safety in the incident but thatthe parties involved should have done more testing before going into production. Shares of BP were lower by 1.3% at $43.23.
Halliburton
(HAL) - Get Report
gained 4.7% at $33.43; Anadarko Petroleum shed 4.3% at $64.71.
Transocean
(RIG) - Get Report
jumped 4.8% to $67.16 after Barclays raised its price target to $77.
Shares of
JDS Uniphase
(JDSU)
surged 4.9% to $11.96 after a
Barron's
article that said the communications test and optical products maker will likely see improved demand as online video traffic grows.
Shares of
McDonald's
(MCD) - Get Report
were flat at $79.31 after the company said sales at U.S. stores open at least a year rose 5.6% in October, less than some analysts had expected. Overall same-store sales rose 6.5%, beating estimates.
AOL
(AOL)
hired financial advisers to explore strategic options for the company -- including a possible tie-up with
Yahoo!
(YHOO)
, according to a
Wall Street Journal
report. AOL's stock traded 4.7% higher to $26.10, and Yahoo!'s stock was up 1.1% to $16.44.
Quantas'
CEO said tests found
oil leaks in three
Rolls-Royce
engines on
Airbus
A380s that were grounded following an engine failure on one of the carrier's jumbo jets last week.
Ashland
(ASH) - Get Report
agreed to sell its global distribution business to
TPG Capital
for $930 million. Ashland's stock jumped 10% to $55.80.
Chrysler
hiked its year-end guidance to an operating profit of $700 million from its previous outlook of break-even to $200 million. Net sales are now expected to hit $42 billion, compared with previous forecasts for between $40 billion and $45 billion.
Shares of
Coventary Health
( CVH) were up 6.6% to $26.52 after analysts at Wells Fargo and Bernstein upgraded the stock after strong earnings.
Shares of
Warner Chilcott
(WCRX)
shed 14% to $20.15 after it reported an 86% drop in profits. Excluding items, earnings came in at 86 cents per share, beating estimates by a penny. Warner Chilcott raised its profit forecast for the year, saying the integration of Procter & Gamble's portfolio is going better than expected, which will lead to lower selling, general and administrative costs. It now expects a profit of $3.35 to $3.45 per share, up from $3.25 to $3.35 per share,
The Associated Press
reported. However it cut is revenue forecast to $2.8 billion to $2.85 billion, down from $2.9 billion to $2.95 billion.
Clearwire
(CLWR)
dropped 6% to $6.56 after Kaufman Brothers downgraded it to a hold.
Footwear retailer
Crocs
(CROX) - Get Report
jumped 9.5% to $15.80 after a strong earnings report last week led analysts to upgrade the stock.
LDK Solar
(LDK)
said after the bell that its earnings tripled to 72 cents per share compared to expectations of 43 cents. The stock jumped 5% in aftermarket trading to $14.01.
In commodity markets, the December
gold contract rose $5.5 to settle at a new high of $1,402 an ounce and the December crude oil contract gained 21 cents, to settle at $87.06 a barrel.
--Written by Melinda Peer and Shanthi Venkataraman in New York
.
Disclosure: TheStreet's editorial policy prohibits staff editors and reporters from holding positions in any individual stocks.
