U.S. equity markets opened lower this morning as traders and investors tried to sort out their reactions to the re-election of President Obama. The initial reaction is that the U.S. economy is headed for a fiscal cliff and nothing is going to stop it from plunging off. In Asia, markets reacted more favorably toward the election results, likely because they’re not all that unhappy with the status quo as embodied by the Obama administration. The Europeans got slapped with some weak industrial production numbers from Germany and, particularly, Spain, where production fell 7% year-over-year in the index (more coverage here). Comments by ECB chief Mario Draghi that Germany was beginning to show some effects from the eurozone crisis did nothing to boost morale, either.
The U.S. dollar index rose today, now up 0.21% at 80.781. The GSCI commodity index is up 2.3% at 644.61, with commodities prices mostly lower today on the stronger dollar. WTI crude oil closed down 4.8% today, at $84.44 a barrel, following today’s EIA report on oil inventories (more coverage here). Brent crude trades down 3.9% at $106.72 a barrel. Natural gas is down 1.2% today at about $3.57 per thousand cubic feet. Gold closed at $1,714.00 an ounce, down less than 0.1% for the day.
The unofficial closing bells put the DJIA fell more than 312 points to 12,933.27 (-2.36%), the NASDAQ fell more than 74 points (-2.48%) to 2,937.29, and the S&P 500 fell -2.37% or nearly 34 points to 1,394.58.
There were several analyst upgrades and downgrades today, including AOL Inc. (NYSE: AOL) cut to ‘underperform’ at CLSA; HCA Holdings Inc. (NYSE: HCA) raised to ‘buy’ at Goldman Sachs; Humana Inc. (NYSE: HUM) cut to ‘sell’ at Goldman Sachs and cut to ‘neutral’ at BofA/ML; Westport Innovations Inc. (NASDAQ: WPRT) started as ‘sell’ at Goldman Sachs; and Time Warner Cable Inc. (NYSE: TWC) reiterated as ‘buy’ with a price target of $100 at Argus.
Earnings reports since U.S. markets closed last night have resulted in some price moves today, including these as of the last half hour of trading: News Corp. (NASDAQ: NWSA) is up 2% at $24.78 (more coverage here); Rackspace Hosting Inc. (NYSE: RAX) is down 4.5% at $63.08; Two Harbors Investment Corp. (NYSE: TWO) is down 3.9% at $10.97; AES Corp. (NYSE: AES) is down 3.2% at $10.14, a new 52-week low; Agrium Inc. (NYSE: AGU) is down 10.6% at $95.81; HollyFrontier Corp. (NYSE: HFC) is up 1.9% at $40.82; Leap Wireless International Inc. (NASDAQ: LEAP) is up 4.8% at $5.43; Macy’s Inc. (NYSE: M) is down 1.8% at $40.62; Tenet Healthcare Corp. (NYSE: THC) is up 10.1% at $27.46 after posting a new 52-week high of $27.59 earlier today (more coverage here); Time Warner Inc. (NYSE: TWX) is up 4.4% at $45.02 (more coverage here); and WellPoint Inc. (NYSE: WLP) is down 5.3% at $57.99.
After markets close today and before they open tomorrow morning we are scheduled to hear from Activision Blizzard Inc. (NASDAQ: ATVI), CenturyLink Inc. (NYSE: CTL), Kinross Gold Corp. (NYSE: KGC), Monster Beverage Corp. (NASDAQ: MNST), Pan American Silver Corp. (NASDAQ: PAAS), Whole Foods Market Inc. (NASDAQ: WFM), Carlyle Group LP (NASDAQ: CG), Dean Foods Inc. (NYSE: DF), Kohl’s Corp. (NYSE: KSS), and The Wendy’s Co. (NASDAQ: WEN).
Some standouts from today include the following stocks:
James River Coal Co. (NASDAQ: JRCC) is down 29.8% at $3.30. The coal mining company reported better-than-expected losses this morning, but S&P cut debt rating to default levels. More coverage here.
Plexus Corp. (NASDAQ: PLXS) is down 27.5% at $20.28 after posting a new 52-week low of $19.65 earlier today. The electronics components supplier was cut loose by a major customer last night. More coverage here.
Stay tuned for Thursday. St. Louis Fed President James Bullard is giving a speech. We have noted the following events on the schedule (all times Eastern):
- 8:30 a.m. – International trade
- 8:30 a.m. – New claims for unemployment benefits
- 10:30 a.m. – EIA weekly natural gas storage report
- 1:00 p.m. – 30-year bond auction
- 4:30 p.m. – Fed balance sheet and money supply
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