Mid-Day Update: Stocks Slump After Italian Debt Costs Spike; Investors Digest Fed Move

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Stocks are lower in mid-day trading while Wall Street digests yesterday's decision by the Federal Reserve to hold rates unchanged while noting significant downside risk to the American economy. Investors kept a keen eye across the Atlantic as Italy's cost of debt rose sharply.

The Euro declined below a key $1.30 level as Italy sold 3 billion euros of five year bonds that saw yields rise to a euro-era high of 6.47%. Germany had sold 4.18 billion of two-year treasury notes at a yield of $0.29%. European stocks finished the day lower.

In company news:

Broadcom ( BRCM ) shares are firm after it said it increased its Q4 revenue outlook to the high end of the prior range to about $1.8 bln. The Street view is $1.76 bln, according to Thomson Reuters.

Shares of Goldman Sachs ( GS ) are down while Bloomberg reports that the bank has managed only a single offering in China in three years. At the same time fees from offerings grew to $2.1 billion last year from $404 million five years ago, the report said.

Fitch ratings said that global pharmaceuticals cmpanies will face significant operating challegenes during 2012 as patents continue to expire, according to a Reuters report. Among the losers Fitch sees: Eli Lilly ( LLY ), Bristol-Myers Squibb ( BMY ) and Pfizer ( PFE ).

First Solar (FSLR) forecasts 2011 sales in the range of $2.8 to $2.9 bln, down from prior guidance of $3 to $3.3 bln and below the analyst consensus of $3.19 bln on Thomson Reuters. EPS is seen in the range of $5.75 to $6.00, vs. expectations of $6.88 per share.

J.W. Marriott Jr. will step down from the post of the chief executive of Marriott International (MAR) next March, according to the Washington Post. Marriott, son of the founder of the global hotel chain, will be replaced by Arne Sorenson as CEO but will stay on as executive chairman. Sorenson, a company veteran who currently serves as president and chief operating officer, will be the first person outside the Marriott family to run the company.

ADRs of China Petroleum & Chemical (SNP) - also called Sinopec - are lower while the company moves ahead with acquisitions of natural gas assets despite a negative economic outlook and weak sector profits, the Associated Press reports.

Shares of IBM (IBM) are trending lower as media reports indicate that European Union regulators have accepted concessions offered by Big Blue to end the antitrust probe and avoid a possible fine. IBM had proposed concessions in September.

Commodities are down as February gold contracts are down $76.30 to $1,586.80 an ounce while January crude oil contracts are down $4.43 to $95.71 a barrel.

In energy ETFs, the United States Oil Fund (USO) is down 4.22% to $36.98 and the United States Natural Gas fund (UNG) is down 3.46%, to $6.97.

In precious metal ETFs, the SPDR Gold Trust (GLD) is down 2.75% to $154.09. Market Vectors Gold Miners (GDX) is down 2.35% to $52.77. iShares Silver Trust (SLV) is down 4.90% to $28.36.

Here's where markets stand at mid-day:

-NYSE down 79.44 (1.09%) to 7,198.18

-DJIA down 114.66 (0.96%) to 11,840.28

-S&P 500 down 12.18 (0.99%) to 1,213.55

-Nasdaq down 42.67 (1.65%) to 2,536.60

GLOBAL SENTIMENT

Nikkei down 0.39%

Hang Seng down 0.5%

Shanghai Composite

FTSE-100 down 1.12%

DAX-30 down 1.72%

MID-DAY NYSE INDEX WATCH

NYSE Energy down 2.6% at 11,797.15

NYSE Financial down 0.2% at 3,920.49

NYSE Health Care down 0.2% at 6,750.14

NYSE Arca Tech 100 down 1.7% at 1,054.61

UPSIDE MOVERS

(+)BRCM, (+2.7% )Boosts Q4 revenue view

(+) AVP, (+6.0%) Searching for new CEO

DOWNSIDE MOVERS

(-)FSLR, (-20%) Slashes 2011 outlook

(-)INTC, (-0.9%) Selects INSIDE Secure to provide NFC technology and products

(-)LNG, (-11.2%) To Sell 33 Mln Shares in Offering

(-)KSS, (-1.3%) Downgraded to Hold from Buy at Deutsche Bank

(-)CAT, (-4.9%) To sell part of Bucyrus distribution business



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

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This article appears in: Investing , Commodities

Referenced Stocks: BMY , BRCM , GS , LLY , PFE

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