U.S. Stocks Fight Back from Early Downdraft; Italy, Cyprus in Focus
It's beginning to feel like deja vu all over again, as downbeat economic rumblings out of western Europe have begun pressuring U.S. equities, with Italian political uncertainty taking the spotlight off Cyprus today. As a result the Dow Jones Industrial Average, which had topped out record highs yesterday, fell sharply at the open, pulling the Nasdaq and S&P 500 indexes with it, although the indexes have managed to pare their losses, pushing to their best levels of the day in recent dealings.
Stocks in Europe tumbled after efforts to form an Italian coalition government failed. The head of Italy's center-left alliance, Pier Luigi Bersani, ruled out forming a coalition government and said that only an "insane person" would want to govern Italy and that the country is a "mess". Italy is still struggling to form a government following February's inconclusive election.
Elsewhere in Europe, Cypriot authorities were expected to announce capital controls later Wednesday in preparation for the country's supposed reopening of the country's banks on Thursday. The banks have been shuttered since March 16th to prevent a mass withdrawal, with market volatility anticipated tomorrow once they reopen.
On the domestic front, uptrending home sales -- a key driver of overall market strength during the current bull run -- disappointed slightly to the downside this morning, posting an 0.4% decline in February, contributing to the negative tone.
Looking ahead, four Federal Reserve presidents -- Boston Fed President Eric Rosengren, Cleveland Fed President Sandra Pianalto,Minneapolis Fed President Narayana Kocherlakota, and Chicago Fed President Charles Evans -- will speak today.
European exchanges are lower across the board as extreme uncertainty in Cyprus and Italy weigh on those bourses, while Asian exchanges traded fractionally higher.
Commodity prices were mixed, with oil down $0.45, at $95.89 a barrel. Natural gas pushed through the $4 mark, up $0.063 to $4.054 per million BTUs.
Gold futures were up $5.90 at $1603.20 per ounce, while silver slipped $0.204 to $28.475 per ounce. Copper was up $0.0015 to $3.444.
Here's where the markets stood at mid-day:
NYSE Composite down 33.52 (-0.37%) to 9,050.18
Dow Jones Industrial Average down 41.31 (-0.28%) to 14,518.34
S&P 500 down 3.78 (-0.24%) to 1,559.99
Nasdaq Composite Index down 5.30 (-0.16%) to 3,247.19
Nikkei 225 Index up 0.18%
Hang Seng Index up 0.69%
Shanghai China Composite Index up 0.14%
FTSE 100 Index down 0.24%
DAX down 1.02%
CAC 40 down 1.06%
NYSE SECTOR INDICES
NYSE Energy Sector Index (^NYE) down 55.13 (-0.42%) at 13,202.84
NYSE Financial Sector Index (^NYK) down 32.89 (-0.60%) to 5,456.13
NYSE Healthcare Sector Index (^NYP) down 17.41 (-0.20%) to 8,794.83
(+) UTSI (+19.9%) Issue spikes on report that shareholder Shah Capital Management on Wednesday offered to buy the company's outstanding shares for $3.20 apiece.
(+) TROV (+6.4% at $6.12 but off a day high $6.69) Shares rise after the company says its urine-based HPV-HR assay, a molecular human papillomavirus (HPV) test is now commercially available. The non-invasive test s designed to accurately identify the presence or absence of 15 known high-risk HPV strains using proprietary DNA sequences.
(+) RVLT (+41%) Stock brightens to new 52-week top of $2.50 after the company introduced a new lighting product. The 15-watt tube lamp from LED manufacturer Seesmart, which was acquired by Revolution Technologies in December, is a four-foot T8 lamp, utilizing the lowest wattage and generating the highest light output in its category. The tube can be rotated to create customizable lighting angles.
(-) ALLT (-2.3%) Shares touch 52-week lows. According to Bloomberg, the reason for the plunge is speculation that the European recession is limiting orders to the company.
(-) ASTM (-36.5%) Stock craters to a new 52-week low after the company announced it was cutting about half of its workforce and making a strategic change in research and development programs.
(-) GV (-15.3% at $4.43 but above a day low $4.07) Issue tarnished after the company yesterday reported net income increased in 2012 to $0.47 per share from $0.03 per share in 2011. Revenue was $81.6 million in 2012 from $32.8 million the prior year.
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