Stocks Slide as Firms Lower Outlooks
Stocks turned lower Monday as a pair of lowered outlooks arrived just in time for the holidays.
Traders expect thin volume in the week ahead with few players taking on major positions.
Volatility has steadily declined over the past few weeks, prompting some to question whether those crazy swings are gone for good or just taking a holiday break.
With the auto bailout behind us and the holidays just a few days away, analysts say traders will be looking ahead to fourth-quarter earnings, due out in mid-January, and how retailers fared this holiday season.
And so far, it's not pretty.
The world's number one car maker, Toyota Motor , forecast its first ever operating lossdue to a relentless global slide in car sales and a crippling rise in the yen. The announcement came after the close of the Japanese stock market.
Toyota's warning is the second in less than 7 weeks, after domestic rival Honda Motor also took the rare step of altering its guidance outside the usual quarterly reporting season. The downward revision was bigger than predicted.
General Motors was again the biggest drag on the Dow, falling more than 15 percent.
Walgreen, one of the country's largest drug-store chains, missed its earnings target and slashed its new-store-opening rate.
And heavy-equipment maker Caterpillar announced that it was cutting white-collar pay by up to 50 percent and offering buyouts to some employees. This comes on the heels of Cat's announcement last week to lay off more than 800 workers at an Illinois engine-assembly plant.
Techs were some of the day's biggest decliners, with Micron Technology off more than 10 percent after Caris cut its price target on the stock to $3 from $4.25.
Even Apple shares were lower, despite buzz that an iPhone nano may be in the offering. Macrumors.com reports that case maker XSKN has a section on its site called iPhone nano.
In the financial sector, American depositary shares of UBS slipped after the Swiss bank confirmed it will get a $1.8 billion loan from the covered bond bank of Swiss mortgage institutions.
Shares of American International Group advanced after the insurer agreed to sell its HSB Group to German insurer Munich Re for $742 million.
Retailers were mostly lower, with department-store operators Macy's and JCPenney down sharply, as a winter blast across much of the northern part of the country put a frosty blanket on hopes for a Hail Mary pass in the final shopping weekend before Christmas.
>> To find out how the retail season is shaping up, check outCNBC's Holiday Central.
Speaking of deluge, we're going to get blanketed with economic data in the next two days to squeeze it all in before Christmas: GDP, home sales, durable goods and personal income/spending are all due out.
TUESDAY: Final reading on Q3 GDP; consumer sentiment; existing-home sales; new-home sale
WEDNESDAY: Weekly mortgage applications; durable-goods orders; weekly jobless claims; personal income/spending; weekly crude and nat-gas inventories; U.S. financial markets close at 1pm
THURSDAY: All U.S. financial markets closed for Christmas holiday