Dow Posts 6-Day Decline as EU Worries Linger
Stocks ended off their worst levels Wednesday following news that Greece will receive another bailout payment, but still closed in negative territory amid lingering concerns over the rest of the euro zone.
Stocks tumbled heavily at the open, but all three major averages still recovered more than half of their losses throughout the session.
The Dow Jones Industrial Average tumbled for a sixth-consecutive session, falling 97.03 points, or 0.75 percent, to end at 12,835.06, led by United Tech and GE . The blue-chip index has slipped more than 3 percent in the last six sessions. The last time the Dow was down six times in a row was last August.
The S&P 500 erased 9.14 points, or 0.67 percent, to finish at 1,354.58. The Nasdaq slipped 11.56 points, or 0.39 percent, to close at 2,934.71.
The CBOE Volatility Index, widely considered the best gauge of fear in the market, closed above 20.
All key S&P sectors ended in the red, led by industrials and financials.
“We can’t sweep the European issues under the rug,” said Todd Schoenberger, managing principal at The BlackBay Group. “They’ve been persisting and continuing to get larger…it’s like cancer and it’s not going away unless it’s being treated.”
The board of the European Financial Stability Facility (EFSF) agreed to make a 5.2 billion euro payment ($6.72 billion) in emergency aid to Greece, according to a senior euro zone official.
“Anytime you have any type of bailout, it acts as a quick band-aid,” said Schoenberger. “But you can’t continue down this path of throwing money at the problem.”
Earlier, fears that Greece could be pushed out of the euro zonefurther dented confidence and amid ongoing political negotiations to form a coalition government.
Meanwhile, investors were also on edge amid news that Spain might need to set aside another $45 billionto save its banks. Yields on Spanish 10-year bonds crossed 6 percent for the first time in two weeks, while the nation's stock market tumbled to close near nine-year lows.
“Market is pulling back on uncertainty and concern in the euro zone causing investors to pause and become more protective,” said Mark Martiak, senior wealth strategist at Premier/First Allied Securities. “Still, companies have reported solid earnings and valuations have been attractive...we’ll eventually get more transparency and see more confidence.”
Oil prices fell for a sixth-straight day to settle under $97 a barrel, while gold slumped below $1,600 an ounce. Still, gold miners including GoldCorp and Newmont Mining rallied.
Among earnings, Macy's reported higher-than-expected earnings, helped by rising online sales, but shares tumbled after the retailer kept its full-year profit forecast.
Disney gained after the media conglomerate reported stronger revenue and forecast-beating profit, thanks to cable channels and theme parks. In addition, at least six brokerages raised their price target on the company.
Toyota reported a surge in profits and forecast a big recovery in annual earnings after a year of disruptive natural disasters.
Cisco , Activision Blizzard and NewsCorp are among notable companies scheduled to post earnings after-the-bell tonight.
MetroPCS surged after a report that the company is negotiating a possible merger with T-Mobile USA.
Meanwhile, Research In Motion hired two senior executivesas the BlackBerry maker looks to regain lost market share from Apple's iPhone.
In the latest drama at Yahoo , hedge-fund manager Daniel Loeb demanded that CEO Scott Thompson resign immediatelyand suggested that he be replaced by the the Internet company's CFO or global head of media on an interim basis.
On the economic front, wholesale inventories rose a less-than-expected0.3 percent in March to $480.4 billion, after an unrevised 0.9 percent gain in February, according to the Commerce Department.
Weekly mortgage applications gained last weekas purchase demand rose for the third week, according to the Mortgage Bankers Association.
Treasury prices were little changedafter the government auctioned $24 billion in 10-year notes a high yield of 1.855 percent and bid-to-cover of 2.90.
—By CNBC’s JeeYeon Park (Follow JeeYeon on Twitter: @JeeYeonParkCNBC)
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