See other (s)Elections Articles
Title: U.S. Stocks Post Biggest Post-Election Drop on Economic Concern
Source:
(Bloomberg
URL Source: http://www.bloomberg.com/apps/news? ... d=aj_ayFUP0riQ&refer=worldwide
Published: Nov 5, 2008
Author: By Elizabeth Stanton
Post Date: 2008-11-05 21:48:04 by TwentyTwelve
Keywords: Stock Market Loss, Economic Concerns
Views: 216
Comments: 16
U.S. Stocks Post Biggest Post-Election Drop on Economic Concern By Elizabeth Stanton Nov. 5 (Bloomberg) -- The stock market posted its biggest plunge following a presidential election as reports on jobs and service industries stoked concern the economy will worsen even as President-elect Barack Obama tries to stimulate growth. Citigroup Inc. tumbled 14 percent and Bank of America Corp. lost 11 percent as the Standard & Poor's 500 Index and Dow Jones Industrial Average sank more than 5 percent. Nucor Corp., the largest U.S.-based steel producer, slid 10 percent after bigger rival ArcelorMittal doubled production cuts amid slowing demand. Boeing Co., the world's second-largest commercial planemaker, lost 6.9 percent after UBS AG forecast a 3 percent drop in global air traffic next year. ``We had an election yesterday; that doesn't mean the problems go away,'' said Kevin Rendino, a Plainsboro, New Jersey- based money manager at BlackRock Inc. who oversees $10 billion. ``We still have an economic slowdown.'' The S&P 500 tumbled 52.98 points, or 5.3 percent, to 952.77, erasing yesterday's 4.1 percent rally. The Dow retreated 486.01, or 5.1 percent, to 9,139.27. The Russell 2000 Index of small U.S. companies fell 5.7 percent to 514.64. The MSCI World Index of 23 developed markets decreased 2.5 percent to 982.98. The slide halted an 18 percent rebound from the S&P 500's five-year low on Oct. 27. The benchmark for U.S. equities has lost more than 35 percent this year, the steepest annual plunge since 1937, and Obama will have to contend with an economy pummeled by the fastest contraction in manufacturing in 26 years and the lowest consumer confidence. Biggest Rally Erased The market's decline came a day after the biggest presidential Election Day gain since the New York Stock Exchange first opened for trading on a voting day in 1984. The report by ADP Employer Services showed companies cut 157,000 jobs in October, the most since November 2002 when the U.S. was emerging from a recession. The Institute for Supply Management said service industries in the U.S., which make up 90 percent of the economy, contracted by the most on record. About 1.3 billion shares changed hands on the NYSE, 11 percent less than the three-month daily average. Citigroup lost $2.05 to $12.63 and Bank of America plunged $2.78 to $21.75. The S&P 500 Financials Index sank 8.8 percent after extending declines late in the day following Oppenheimer & Co. analyst Meredith Whitney's prediction on CNBC that the mortgage market will contract and more than $2 trillion in available credit-card lines will be pulled from the system. Whitney also said potential loan modifications under an Obama administration will hurt banks and diminish their appetite for risk. $6 Trillion Lost The S&P 500 has lost about 39 percent since it peaked at 1,565.15 on Oct. 9, 2007, as the U.S. economy contracted 0.3 percent last quarter and credit-related losses and writedowns by global financial firms approached $700 billion. More than $6 trillion was erased from U.S. equities this year by the worst financial crisis since the Great Depression. Nucor sank $4.16 to $35.50. Luxembourg-based ArcelorMittal reported third-quarter profit that fell short of analyst estimates, said its global output will drop by more than 30 percent, and forecast fourth-quarter earnings will fall as much as 48 percent. The company's New York-registered shares slumped 22 percent to $24.88, their biggest retreat in seven years. Boeing fell $3.67 to $49.55. Its share price, which rose 28 percent from Oct. 10 through yesterday, ``is at least six to nine months from bottoming and beginning to mover higher again,'' David E. Strauss, a New York-based analyst at UBS, wrote in a report. Aircraft deliveries may tumble 29 percent from 2009 to 2012, the analyst said. `Continued Softening' Textron Inc. lost $1.71, or 9.2 percent, to $16.93. The world's biggest business-jet maker through its Cessna unit reduced the number of Citation jets it plans to deliver next year, citing ``continued softening in the global economic environment.'' Stocks extended their retreat even as Nancy Pelosi, Speaker of the House of Representatives, said Democrats may seek two economic stimulus measures if President George W. Bush limits the size of a plan to be considered during the post-election ``lame- duck'' session. Obama's party captured at least 19 seats in the House and at least five in the Senate, expanding its congressional majority. General Growth Properties Inc. tumbled almost 50 percent to $2.25 for the biggest drop in the S&P 500. The U.S. mall owner that has lost more than 90 percent of its market value on concern it won't be able to refinance debt coming due this year reported a wider third-quarter loss and suspended its quarterly dividend. Bond Insurers MBIA Inc. and Ambac Financial Group Inc. slumped after the bond insurers posted wider losses than analysts estimated. MBI fell 22 percent to $8.16. Ambac, dropped from the S&P 500 in June, fell 41 percent to $2.01. Slumping credit markets forced the companies to increase reserves for claims. Pioneer Natural Resources lost 15 percent to $24.79. The oil and natural-gas producer in North America and Africa reported third-quarter earnings that missed analyst estimates and said it will cut drilling activity. Sara Lee Corp. slid 14 percent to $10.20. The maker of frozen cakes and Jimmy Dean sausages said full-year profit will be less than it previously estimated because of falling foreign currencies and waning demand in Europe. Marsh & McLennan Cos. fell 12 percent to $26.06. The world's second-biggest insurance broker said profit dropped 78 percent in the third quarter amid the slowing U.S. economy and price declines for commercial coverage and reinsurance. Earnings Season Most companies in the S&P 500 have managed to increase profits even as the economy slows. Of the 386 companies that reported third-quarter results so far, 232 posted higher earnings than in the year-earlier period. Still, profits are down 7.4 percent on average after accounting for losses at financial companies. Medco Health Solutions Inc. climbed 9.1 percent to $41.47 for the biggest of only 13 advances in the S&P 500. A surge in use of generic and mail-order prescription drugs fueled a 38 percent increase in third-quarter profit at the largest U.S. drug benefits manager. Molson Coors Brewing Co. gained 8.3 percent to $41.78. The third-largest U.S. beer maker reported market-share gains in Canada and the U.K. and said it expects to achieve total cost savings from its joint U.S. venture with SABMiller Plc six months early. Chesapeake Energy Corp. climbed 8.2 percent to $24.83 on speculation it will be acquired by BP Plc. General Motors Corp. slipped 16 cents, or 2.8 percent, to $5.56. GM, the biggest U.S. automaker, needs government aid because ``time is very short'' to stop its collapse, Roger Altman, an adviser to the automaker and Obama, said in an interview. Recession Rallies The S&P 500 Index may be on the cusp of a rally by Inauguration Day, based on the speed of its tumble from last year's peak and the time it took stocks to gain before recessions ended in 1975, 1982 and 1991, data compiled by Bloomberg show. This year's plunge in stocks suggests that equity investors anticipate an economic contraction as severe as the one that began under Richard Nixon that will end in July. The S&P 500's slump since last year's high is the steepest for a comparable period since the gauge fell 43 percent in the 13 months ended in October 1974, Bloomberg data show. 1970s Recession The economy then was mired in a recession that lasted 16 months and ended in March 1975, five months after the equity market began its rebound. During the recessions of 1982 and 1991, the S&P 500 began to climb four months and five months before the economy started to recover, respectively. Based on the market's history of anticipating economic recoveries, the S&P 500 may embark on its next bull market in February, about a month after Obama's inauguration on Jan. 20. Stocks gained yesterday after the 17th straight decline in a key interest rate, a sign that as much as $3 trillion of emergency funds provided by governments to resuscitate bank lending are working. The London interbank offered rate, or Libor, that banks charge each other for three month loans in dollars fell again today to the lowest level since December 2004. To contact the reporter on this story: Elizabeth Stanton in New York at estanton@bloomberg.net. Last Updated: November 5, 2008 20:19 EST
Post Comment Private Reply Ignore Thread
Top • Page Up • Full Thread • Page Down • Bottom/Latest
#1. To: TwentyTwelve (#0)
That was years ago ! We're well beyond concern at this point.
"If you love wealth more than liberty, the tranquility of servitude better than the animating contest of freedom, depart from us in peace. We ask not your counsel nor your arms. Crouch down and lick the hand that feeds you. May your chains rest lightly upon you and may posterity forget that you were our countrymen.”—Samuel Adams
That was years ago ! We're well beyond concern at this point. The masses (sheeple) are just now getting to the concerned point. They are many years behind us.
Why do they ignore the elephant in the room?
I shall not vote for evil, lesser or otherwise. "If you love wealth more than liberty, the tranquility of servitude better than the animating contest of freedom, depart from us in peace. We ask not your counsel nor your arms. Crouch down and lick the hand that feeds you. May your chains rest lightly upon you and may posterity forget that you were our countrymen.”—Samuel Adams
Don't Worry People. Pretend You Are In A Planet of the Apes Movie...
LOL "If you love wealth more than liberty, the tranquility of servitude better than the animating contest of freedom, depart from us in peace. We ask not your counsel nor your arms. Crouch down and lick the hand that feeds you. May your chains rest lightly upon you and may posterity forget that you were our countrymen.”—Samuel Adams
"If you love wealth more than liberty, the tranquility of servitude better than the animating contest of freedom, depart from us in peace. We ask not your counsel nor your arms. Crouch down and lick the hand that feeds you. May your chains rest lightly upon you and may posterity forget that you were our countrymen.”—Samuel Adams
I don't understand... Why do the markets bomb on reports of job losses? In the era of "free trade" why aren't American job losses being heralded? After all, what can result from shipping US jobs overseas but fewer US jobs? That's the goal, isn't it? So we obviously WANT fewer US jobs.. They got what they wanted.. Why aren't they happy?
“Stop throwing the Constitution in my face,” President Bush screamed back. “It’s just a goddamned piece of paper!”
I don't understand... Why do the markets bomb on reports of job losses? In the era of "free trade" why aren't American job losses being heralded? After all, what can result from shipping US jobs overseas but fewer US jobs? That's the goal, isn't it? So we obviously WANT fewer US jobs.. They got what they wanted.. Why aren't they happy? Haaaahahahaha! Well done.
"If you love wealth more than liberty, the tranquility of servitude better than the animating contest of freedom, depart from us in peace. We ask not your counsel nor your arms. Crouch down and lick the hand that feeds you. May your chains rest lightly upon you and may posterity forget that you were our countrymen.”—Samuel Adams
I figured they'd call an emergency, group masturbation session in the conference room. But they're sad instead? Wall Streeter's are such a fickle bunch.
“Stop throwing the Constitution in my face,” President Bush screamed back. “It’s just a goddamned piece of paper!”
"If you love wealth more than liberty, the tranquility of servitude better than the animating contest of freedom, depart from us in peace. We ask not your counsel nor your arms. Crouch down and lick the hand that feeds you. May your chains rest lightly upon you and may posterity forget that you were our countrymen.”—Samuel Adams
Look at the Asian Markets selling off hard on Obama win. It's going to get much worse for the markets under that tax and spend socialist
Hangsang 800 down...Japan...550 down.. Absolute fear !! They think America has lost it's mind! ..and it has!!
..and it has!! spinning OVER the abyss.
"If you love wealth more than liberty, the tranquility of servitude better than the animating contest of freedom, depart from us in peace. We ask not your counsel nor your arms. Crouch down and lick the hand that feeds you. May your chains rest lightly upon you and may posterity forget that you were our countrymen.”—Samuel Adams
"If you love wealth more than liberty, the tranquility of servitude better than the animating contest of freedom, depart from us in peace. We ask not your counsel nor your arms. Crouch down and lick the hand that feeds you. May your chains rest lightly upon you and may posterity forget that you were our countrymen.”—Samuel Adams
Concern
#2. To: Rotara (#1)
Concern
#3. To: TwentyTwelve, Jethro Tull (#0)
U.S. Stocks Post Biggest Post-Election Drop on Economic Concern
Body Art Cobleskill, NY
#4. To: TwentyTwelve (#2)
The masses (sheeple) are just now getting to the concerned point. They are many years behind us.
#5. To: Rotara (#4)
#6. To: Rotara (#4)
#7. To: TwentyTwelve (#5)
Don't Worry People. Pretend You Are In A Planet of the Apes Movie...
#8. To: TwentyTwelve (#6)
#9. To: TwentyTwelve (#0)
The report by ADP Employer Services showed companies cut 157,000 jobs in October..
#10. To: Jhoffa_ (#9)
The report by ADP Employer Services showed companies cut 157,000 jobs in October..
#11. To: Rotara (#10)
#12. To: Jhoffa_ (#11)
#13. To: Rotara (#4)
#14. To: Critter, Jethro Tull, Rotara, christine (#3)
#15. To: TwentyTwelve (#14)
Absolute fear !! They think America has lost it's mind!
#16. To: TwentyTwelve (#14)
"Take care of my family Obama........." ~ El Paso Jumper
Top • Page Up • Full Thread • Page Down • Bottom/Latest