Wall Street lower on fiscal cliff jitters, Amazon in focus
Tuesday, 27 November 2012
U.S. equity markets were lower Tuesday afternoon as investors remained worried about the fiscal cliff issue in Washington.
Investors shrugged off strong reports on housing and consumer confidence, as well as the latest news from Greece, where leaders struck a deal for the nation to avoid defaulting on its debt.
As at 2.45pm EDT, the Dow Jones Industrial Average was 0.61% lower at 12,887.85, the S&P 500 was down 0.43% at 1,400.34 and the NASDAQ was off 0.21% at 2,970.53.
Congress is back in session, lawmakers are under pressure to reach a deal with the White House before the end of the year in order to avoid falling over the fiscal cliff.
Late Monday, eurozone finance ministers and the International Monetary Fund reached an agreement that moves Greece closer to receiving a massive bailout payment.
The Organization for Economic Cooperation and Development warned early Tuesday that Europe's worsening economy next year will slow U.S. growth more than previously forecast.
In corporate news, Amazon (NASDAQ:AMZN) shares rose after it said that worldwide sales of its Kindle device were more than double last year's record over the holiday shopping weekend.
Packaged food maker ConAgra (NYSE:CAG) announced that it reached a deal to buy Ralcorp (NYSE:RAH), the largest U.S. manufacturer of private label food, for $90 a share in cash - a 28% premium from Monday's closing price.
Home-security monitoring company ADT Corp. (NYSE:ADT) Tuesday reported fiscal fourth-quarter earnings edged up 1.1 per cent on higher revenue and a stronger gross margins.
Acadia Pharmaceuticals (NASDAQ:ACAD) stock surged 155 per cent Tuesday on positive news for its Parkinson's drug.
Shares of Green Mountain Coffee Roasters (NASDAQ:GMCR) rose more than 2% ahead of the company's earnings release, due out after the closing bell.
On the economic front, U.S. home prices rose in September for the sixth straight month, signaling that the housing market is “in the midst of a recovery” according to the S&P/Case-Shiller home-price index.
The 20-city composite index posted a non-seasonally adjusted 0.3% increase in September to reach the highest level in two years, following a 0.8% gain in August. Home prices were up 3% from September 2011 for the largest annual percentage growth since July 2010.
The Commerce Department reported orders for durable goods came in unchanged in October, with the data better than the decline anticipated by economists.
The Conference Board also said its consumer confidence index rose to 73.7 in November from 73.1 in October. That’s above the 72.2 level forecast by economists and the best level since February 2008. The October reading was upwardly revised from 72.2.
On the NYMEX, crude for January delivery slipped 33 cents to $87.42 a barrel while gold futures for December delivery fell $7.30 to $1,742.30 an ounce.
European markets finished higher with the DAX rising 0.55%, the FTSE 100 gaining 0.22% and the CAC 40 adding 0.03%.
Wall Street opened flat on Friday (November 30), amid caution ahead of a statement from U.S. President Barack Obama on the progress of budget talks in Washington that have fueled volatility and nervousness in the financial markets. Consumer spending fell in October for the first time in five months...