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Stocks Fall Amid 'Fiscal Cliff', Greece Worries; Apple (AAPL) Tumbles

 November 08, 2012 04:15 PM

(By Balachander) U.S. stocks ended sharply lower as worries over the looming "fiscal cliff" and news on Greece offset a set of positive domestic economic reports.

The S&P 500 Index retreated 1.22 percent to end at 1,377.51. The Dow Jones Industrial Average shed 0.94 percent to finish at 12,811.32. The Nasdaq Composite Index lost 1.42 percent to close at 2,895.58.

Investors focused on a so-called "fiscal cliff" of roughly $600 billion in spending cuts and tax increases that could weigh on economic growth.

Also denting the market sentiment were media reports that European finance ministers have delayed a decision on releasing next bailout tranche to Greece.

The number of Americans who continued to receive jobless benefits unexpectedly declined last week, a government data showed. Jobless claims fell 8,000 to 355,000 for the week ended Nov. 3 from a revised 363,000, while economists projected 370,000 applications.

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A report from the Bureau of Economic Analysis showed that trade deficit for September narrowed to $41.5 billion from $43.8 billion in August, while economists expected trade gap widened to $45.0 billion.

The European Central Bank (ECB) kept its key interest rate unchanged at a record low of 0.75 percent. ECB President Mario Draghi said the bank is prepared to purchase government bonds if necessary conditions are fulfilled.

Meanwhile, the Greek parliament narrowly approved Greece's new round of austerity measures to secure bailout funds, despite violent protests across the country.

[Related -The Wendy's Co (NASDAQ:WEN) Q4 Earnings Preview: Beefy Costs to Hurt Margins?]


In corporate news, Apple Inc. (NASDAQ: AAPL) lost 3.72 percent amid a report that Samsung's Galaxy S3 overtook Apple's iPhone 4S to become the world's best-selling smartphone model in the third quarter. Strategy Analytics said Samsung shipped 18 million Galaxy S3 units, while Apple shipped an estimated 16.2 million iPhone 4S units. Apple shares are down more than 20 percent from their September high of $705.

QUALCOMM Inc. (NASDAQ: QCOM) rose 4.30 percent after the cell phone chip maker posted quarterly earnings and revenue that beat market expectations and guided first-quarter above consensus.

Kohl's Corp. (NYSE: KSS) retreated 5.10 percent after the apparel company guided fourth-quarter profit below Wall Street consensus and narrowed its full-year forecast.

McDonald's Corp. (NYSE: MCD) shed 1.99 percent after the foodservice retailer said global comparable sales fell 1.8 percent in October, declining for first time since March 2003.

Wendy's Co. (NASDAQ: WEN) added 3.05 percent after the quick-service hamburger company said same-store sales at its North America Company-operated restaurants grew 2.7 percent. This marks the sixth consecutive quarter of positive same-store sales for both company-operated restaurants and franchisees, Wendy's said.

Dean Foods Co. (NYSE: DF) raised its 2012 forecast yet again after reporting better-than-expected quarterly earnings, helped by strong sales growth at WhiteWave-Alpro segment, and its shares added 1.99 percent.

AMC Networks Inc. (NASDAQ: AMCX) surged 8.53 percent after the company posted third-quarter results that topped market forecasts.

CBS Corp. (NYSE: CBS) gained 1.06 percent after the TV network posted higher quarterly profit and revenue.

DUSA Pharmaceuticals Inc. (NASDAQ: DUSA) jumped 37.54 percent after the dermatology company agreed to be acquired by India-based Sun Pharmaceutical Industries Ltd. for roughly $230 million in cash or $8.00 a share.

BioCryst Pharmaceuticals Inc. (NASDAQ: BCRX) slumped 40.00 percent after an independent committee recommended the company terminated a study of its peramivir treatment for patients admitted to the hospital with serious influenza. The company also reported a loss for the third quarter.

Global Markets

European markets ended on a negative note, with Germany's DAX down 0.39 percent to close at 7,204.96. France's CAC40 declined 0.06 percent to finish at 3,407.68. The U.K.'s FTSE 100 lost 0.27 percent to end at 5,776.05.

Among Asian markets, China's Shanghai Stock Exchange Composite Index tumbled 1.63 percent to finish at 2,071.51. Japan's Nikkei 225 dropped 1.51 percent to end at 8,837.15. Hong Kong's Hang Seng Index lost 2.41 percent to end at 21,566.91. India's BSE Sensex closed at 18,846.26, down 0.30 percent.

Commodity & Currency Scan

Crude oil futures rose 0.60 percent to $84.95 per barrel, and natural gas futures added 0.45 percent to $3.59 per million metric British thermal units. Gold futures jumped 1.13 percent to $1,733.3 per ounce and silver futures gained 2.30 percent to $32.39 per ounce. 

In the currency market, the euro dropped 0.21 percent against the U.S. dollar to 1.2744. The British pound dipped 0.06 percent against the greenback to 1.5975, and the dollar lost 0.78 percent against the Japanese yen to 79.3700.



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