STOCKS ROUTED
Tweet
Share
E-mail
Get Alerts BAC Hot Sheet
Price: $53.63 -0.37%
Overall Analyst Rating:
SELL (= Flat)
Dividend Yield: 2.1%
EPS Growth %: +23.6%
Overall Analyst Rating:
SELL (= Flat)
Dividend Yield: 2.1%
EPS Growth %: +23.6%
Join SI Premium – FREE
The Dow sold off more than 500 points Thursday due to the liquidity crisis in Europe and weak domestic economic data, suggesting a double dip recession could be likely.
The Dow closed down 513 points, or 4.3%, to close at 11,384. It was the worst one day drop since December 2008. The Nasdaq fell 137 points and the S&P 500 fell 60.
No sector was unfazed, with all major groups in the S&P falling heavily. Financials were one of the weakest groups. In the sector, Bank of America (NYSE: BAC) fell 7.4% to $8.83, Citigroup (NYSE: C) fell 6.6% and JPMorgan (NYSE: JPM) fell 5%.
Worries started this morning on word banks were getting flooded with cash as investors where selling anything of quality.
The move into cash forced some bank to tell clients they will start charging a fee to sit in cash. This pushed money-market mutual funds and financial institutions to put cash to work into short-term markets, pushing rates lower. The cost of borrowing overnight fell below zero.
The massive selling pressure has created a call by many for more easing measures from the Federal Reserve, or QE3. The Fed has been mum on the idea so far, but the matter will be weighed at the upcoming FOMC meeting on August 9th. Also the Jackson Hole meeting will take place from August 26-28. The Fed may be limited to what it can do, which is another market worry.
In addition, the market is still waiting on a U.S. credit rating decision from S&P. Both Fitch and Moody's have already reaffirmed the AAA rating. With the delay from S&P, there was speculation earlier that S&P's decision could be a downgrade.
The Dow closed down 513 points, or 4.3%, to close at 11,384. It was the worst one day drop since December 2008. The Nasdaq fell 137 points and the S&P 500 fell 60.
No sector was unfazed, with all major groups in the S&P falling heavily. Financials were one of the weakest groups. In the sector, Bank of America (NYSE: BAC) fell 7.4% to $8.83, Citigroup (NYSE: C) fell 6.6% and JPMorgan (NYSE: JPM) fell 5%.
Worries started this morning on word banks were getting flooded with cash as investors where selling anything of quality.
The move into cash forced some bank to tell clients they will start charging a fee to sit in cash. This pushed money-market mutual funds and financial institutions to put cash to work into short-term markets, pushing rates lower. The cost of borrowing overnight fell below zero.
The massive selling pressure has created a call by many for more easing measures from the Federal Reserve, or QE3. The Fed has been mum on the idea so far, but the matter will be weighed at the upcoming FOMC meeting on August 9th. Also the Jackson Hole meeting will take place from August 26-28. The Fed may be limited to what it can do, which is another market worry.
In addition, the market is still waiting on a U.S. credit rating decision from S&P. Both Fitch and Moody's have already reaffirmed the AAA rating. With the delay from S&P, there was speculation earlier that S&P's decision could be a downgrade.
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- FS KKR Capital completes $900 million bond offering
- The Ensign Group (ENSG) mentioned as short at Hunterbrook
- Ghalibaf in message posted on his Telegram: we will turn the naval blockade into another defeat for the 'enemy'
Create E-mail Alert Related Categories
Economic Data, Market Check, Trader TalkRelated Entities
JPMorgan, Citi, Federal Open Market Committee, Standard & Poor'sSign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!
