Stock Market News for August 28, 2013 - Market News
Benchmarks took a hammering during Tuesday's trading session
after investors anticipated that a US military strike on Syria
was imminent. Positive consumer confidence data also failed to
boost investor sentiment. However, some investor confidence was
visible through a fall in the CBOE volatility index. The
barometer for measuring investor fear has jumped around 20% in
past two days on the back of a possible attack. All the top
ten S&P 500 industry groups ended in losses, among which
financial stocks suffered the most.
For a look at the issues currently facing the markets, make sure to read today's Ahead of Wall Street article.
The Dow Jones Industrial Average (DJI) lost 1.1% to close the day at 14,776.13. The S&P 500 slipped 1.6% to finish yesterday's trading session at 1,630.48. The tech-laden Nasdaq Composite Index fell 2.2% to end at 3,578.52. The fear-gauge CBOE Volatility Index (VIX) jumped 11.9% to settle at 16.77. Consolidated volumes on the New York Stock Exchange, American Stock Exchange and Nasdaq were roughly 6.18 billion shares, below 2013's average of 6.31 billion shares. Declining stocks outnumbered the advancers. For 76% shares that declined, 22% advanced.
Initially, investor fears regarding the tapering of the bond purchase program dragged the benchmarks into negative territory. However, yesterday investor sentiment was dampened because of the increasing possibility of a US military strike on Syria. Major economies such as Britain, France, Canada and the Arab League have backed the U.S. to give a strong reply to the Syrian government. Adding to investor woes, Russia is backing Syria. Defense Minister Chuck Hagel said military forces were "ready to go" as soon as they get the nod from US President Barack Obama.
Investor sentiments remained unchanged even though positive consumer confidence data was disclosed during yesterday's trading session. The Conference Board Consumer Confidence Index increased 0.5 to 81.5. This is marginally above July's reading of 81 and well above the consensus estimate of 78. The barometer which indicates whether business conditions are "good" dropped to 18.4% from last month's 20.8%. However the gauge which says whether business conditions are "bad" remained flat at 24.8%.
An increase was also witnessed in the S&P/Case-Shiller Home Price Indices. However, this also failed to boost investor sentiment. According to the report, U.S. home prices continued to increase month over month. All 20 cities witnessed an increase. However, only six cities grew at a faster rate when compared to last month. Home prices in Dallas and Denver reached an all-time high.
On the earnings front, shares of Tiffany & Co. (NYSE: TIF ) dropped 1% after its revenue came in below the Street's expectations. However, per share earnings of the company topped estimates. Revenues of the company came in $925.9 million, up 4% year over year. Net income of the company came in at $106.8 million or 83 cents per share, above previous year's figure of $91.8 million or 72 cents a share. The company said strong sales in China overshadowed the weakness in sales witnessed in the U.S.
The financial stocks suffered the most during yesterday's trading session. The Financials SPDR (XLF) lost 2.6%. Stocks such as JPMorgan Chase & Co (NYSE: JPM ), Bank of America Corp (NYSE: BAC ), Citigroup Inc (NYSE: C ), Wells Fargo & Co (NYSE: WFC ) and Goldman Sachs Group Inc (NYSE: GS ) lost 2.3%, 2.6%, 2.7%, 3.0% and 3.0%, respectively.
Industrial stocks also had a very bad day. The Industrials SPDR (XLI) lost nearly 2%. Stocks such as General Electric Company (NYSE: GE ), Honeywell International Inc. (NYSE: HON ), The Boeing Company (NYSE: BA ), Deere & Company (NYSE: DE ) and Caterpillar Inc. (NYSE: CAT ) declined 1.8%, 2.2%, 2.2%, 1.5% and 1.0%, respectively.
BOEING CO (BA): Free Stock Analysis Report
BANK OF AMER CP (BAC): Free Stock Analysis Report
CITIGROUP INC (C): Free Stock Analysis Report
CATERPILLAR INC (CAT): Free Stock Analysis Report
DEERE & CO (DE): Free Stock Analysis Report
GENL ELECTRIC (GE): Free Stock Analysis Report
GOLDMAN SACHS (GS): Free Stock Analysis Report
HONEYWELL INTL (HON): Free Stock Analysis Report
JPMORGAN CHASE (JPM): Free Stock Analysis Report
TIFFANY & CO (TIF): Free Stock Analysis Report
WELLS FARGO-NEW (WFC): Free Stock Analysis Report
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