Investing.com - U.S. stocks opened lower in holiday-thinned
trade on Monday, as concerns over the deadlock in U.S. budget
negotiations weighed on investor confidence.
Trading was expected to remain subdued as many investors already
closed books to lock in profit before the end of the year, reducing
liquidity in the market.
During early U.S. trade, the Dow Jones Industrial Average fell
0.31%, the S&P 500 index retreated 0.29%, while the Nasdaq
Composite index declined 0.30%. U.S. equity markets were set to
close early at 13:30EST (18:30 GMT).
Market sentiment remained under pressure as investors continued to
monitor developments surrounding the fiscal cliff in the U.S.,
approximately USD600 billion in automatic tax hikes and spending
cuts due to come into effect on January 1.
Doubts over whether a deal will be reached ahead of the year-end
intensified late Thursday after House Speaker John Boehner pulled
his so-called "Plan B" fiscal cliff option, which called for tax
increases only on Americans earning USD1 million or more per year,
because his Republican colleagues did not support the legislation.
The U.S. House has adjourned for the Christmas holiday, fueling
speculation that policymakers will not be able to avert the fiscal
cliff. Without a deal, the U.S. could fall back into recession and
drag much of the world down with it.
Adding to concerns, Italian Prime Minister Mario Monti tendered his
resignation after only 13 months in office, paving the way for a
highly uncertain national election in February.
Microsoft saw shares drop 0.77% after the New York Times reported
that sales of the company's new Windows 8 operating system
disappointed PC makers as well as analysts.
In the same sector, U.S. traded shares of Research In Motion
plummeted 1.01% after Exane BNP Paribas cut its target price on the
BlackBerry maker to USD5.50 from USD8.30.
In Internet-linked stocks, Facebook rose 0.34% after Needham raised
its price target on the social media giant to USD33 from USD25.
Elsewhere, financial stocks were broadly lower, as shares in JP
Morgan inched down 0.02% and Bank of America slipped 0.18%, while
Goldman Sachs and Citigroup declined 0.54% and 0.76% respectively.
Across the Atlantic, European stock markets were steady in
lackluster Christmas Eve activity.
France's CAC 40 shed 0.22%, while London's FTSE100 added 0.18% in a
holiday-shortened session. Markets in Germany remained closed for
During the Asian trading session, regional markets eased up in thin
pre-holiday trade, as investors continued to monitor negotiations
among U.S. lawmakers to avoid the looming "fiscal cliff" crisis
ahead of the year-end deadline.
Hong Kong's Hang Seng Index ended up 0.2%, while Australia's
ASX/200 Index settled 0.3% higher, as both markets traded in a
holiday-shortened session ahead of a two-day break.
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