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Closing Update: Wall Street Resumes Sell-Off, Deepens January Decline, as Fear of Emerging Market Contagion Continues

By: MT Newswires
Posted: 1/31/2014 4:08:00 PM
Referenced Stocks: AMZN;MAT;WMT

A meltdown in emerging markets compounded by European deflation risk weighed on global equity prices, with the U.S. no exception. Major averages had trimmed losses mid-afternoon, with the Nasdaq briefly flashing green, but all ended in the red by the final bell. Disappointing earnings from Amazon ( AMZN ) and Mattel ( MAT ), and lowered guidance from retail giant Wal-Mart ( WMT ), added to negative market sentiment, rekindling fears that the U.S. economy has stalled. Better-than-expected consumer spending, an uptick in consumer sentiment, and bargain hunting proved briefly supportive until selling resumed late in the session. All three leading indices are lower for the month, the first negative January in five years.

European markets were against the ropes as well, undermined by weaker-than-expected euro-zone inflation data and weak German retail sales. Even though the EU unemployment rate dropped and UK consumer confidence improved, European bourses all closed in the red with losses amplified by the sell-off in emerging market currencies such as the South African rand, Russian ruble and Turkish lira.

Here's where the markets stand at the close:

US MARKETS

Dow Jones Industrial Index down 149 (-1%) at 15,698.85

S&P 500 down 11.6 (-0.7%) at 1,782.59

Nasdaq Composite Index down 19 (-0.5%) at 4,103.88

GLOBAL SENTIMENT

FTSE 100 down 0.43%

Nikkei 225 down 0.62%

Hang Seng Index down 0.48%

Shanghai China Composite Index down 0.27%

UPSIDE MOVERS

MTW Reported mixed results for Q4 and better-than-expected EPS and revenues for FY13.

CPSI Reported better than expected Q4 earnings earnings and 2014 guidance

UIS Reported quarterly net income of $2.82 per share beating estimates by $1.10

DOWNSIDE MOVERS

MPO Morgan Stanley downgraded the stock to Equal Weight from Overweight

HGR Warned that preliminary fiscal 2013 earnings are below previous company guidance and Wall Street expectations.

FUEL Priced a follow-on public sale of 5 million shares at $61 per share.