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Stocks End Sharply Lower Amid 'Fiscal Cliff' Fears; HP (HPQ) Falls

 December 28, 2012 04:18 PM

(By Balachander) U.S. stocks closed sharply lower amid uncertainty whether an agreement will be reached by the year-end deadline to avert the looming "fiscal cliff".

The S&P 500 Index retreated 1.10 percent to end at 1,402.43. The Dow Jones Industrial Average plunged 1.21 percent to finish at 12,938.11. The Nasdaq Composite Index dropped 0.86 percent to close at 2,960.31.

President Barack Obama and lawmakers are negotiating to address the so-called "fiscal cliff" of roughly $600 billion in spending cuts and tax increases set to begin in January.

The House of Representatives will reconvene this Sunday to restart budget talks.

On the U.S. data front, a report showed pending home sales for November rose 1.0 percent for a third straight month and reached a two-year high.  The Chicago Purchasing Managers' Index (PMI) jumped to 51.6 in December from 50.4 last month. A reading above 50 indicates an increase in business activity.


[Related -Should You Buy HP's Stellar Rebound?]

In corporate news, Hewlett-Packard Co. (NYSE: HPQ) shed 2.56 percent after the personal-computer maker confirmed the Justice Department is probing a possible accounting fraud at Autonomy Corp.

Barnes & Noble Inc. (NYSE: BKS) gained 4.32 percent after the company said UK-based Pearson Plc (NYSE: PSOagreed to invest roughly $89.5 million of cash in its NOOK Media LLC unit.

[Related -Sector Detector: Is There Still Enough Fuel In The Bulls’ Tank?]

Synchronoss Technologies Inc. (NASDAQ: SNCR) added 3.32 percent after the provider of on-demand transaction management services acquired NewBay from the BlackBerry maker Research In Motion Ltd. (NASDAQ: RIMM) for $55.5 million in cash.

Carrizo Oil & Gas Inc. (NASDAQ: CRZO) retreated 5.41 percent after the energy company said it has agreed to sell all of its interest in the Huntington Field in the UK North Sea to a subsidiary of Iona Energy Inc. (TSXV: INA) for $184 million.

Tower International Inc. (NYSE: TOWR) climbed 8.47 percent after the maker of engineered structural metal components said it sold its Korean operations for $47 million in cash to SECO, a privately held Korean auto-parts supplier.

magicJack VocalTec Ltd. (NASDAQ: CALL) jumped 10.26 percent after the provider of voice-over-Internet-Protocol products raised its outlook for the fourth quarter and full year. The company also named Gerald Vento as President and CEO effective Jan. 1.

AEterna Zentaris Inc. (NASDAQ: AEZS) surged 13.82 percent after U.S. health regulators granted Special Protocol Assessment (SPA) for an upcoming Phase 3 registration trial in endometrial cancer with the company's doxorubicin peptide conjugate, AEZS-108.

Omeros Corp. (NASDAQ: OMER) dropped 8.90 percent after the biopharmaceutical company said its experimental knee surgery treatment did not meet its main goal in a late-stage clinical trial.

Global Markets

European markets closed lower, with Germany's DAX down 0.57 percent to close at 7,612.39. France's CAC40 fell 1.47 percent to finish at 3,620.25. The U.K.'s FTSE 100 dipped 0.49 percent to end at 5,925.37.

Asian markets ended in green, with China's Shanghai Stock Exchange Composite Index up 1.24 percent to finish at 2,233.25. Japan's Nikkei 225 rose 0.70 percent to close at 10,395.18. Hong Kong's Hang Seng Index advanced 0.21 percent to end at 22,666.59. India's BSE Sensex ended at 19,444.84, up 0.63 percent.

Commodity & Currency Scan

Crude oil futures dipped 0.08 percent to $90.81 per barrel, while natural gas futures added 1.47 percent to $3.46 per million metric British thermal units. Gold futures fell 0.44 percent to $1,656.3 per ounce and silver futures shed 0.53 percent to $30.08 per ounce.

In the currency market, the euro edged 0.12 percent lower against the U.S. dollar to 1.3220. The British pound gained 0.41 percent against the greenback to 1.6166, while the dollar slid 0.03 percent against the Japanese yen to 86.0700.



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