Stocks tumbled Monday as financials and commodities sold off amid jitters about the global recovery.
The Dow Jones Industrial Average dropped 103.84, or 1 percent, to close at 9,908.39, the first time its closed below 10,000 since November. The S&P 500 shed 0.9 percent and the Nasdaq lost 0.7 percent.
Worries about debt problems in Greece, Portugal and Spain have dragged on markets across the globe for the past week as many worry that these are the next shoes to drop. European finance ministers tried to reassure Group of Seven leaders that the debt situation there is under control but it hasn't been as easy convincing investors, who are backing away from riskier bets.
In addition to battling debt, Greece is faced with an assault on another front: Organized labor. Unions arethreatening more strikes if the Socialist government goes through with a tough cost-cutting plan.
In today's action, Bank of America and Travelers were the biggest drags on the Dow.
Home Depot and HP were the only Dow components that ended higher.
Home Depot gained over 2 percent after Morgan Stanley raised its rating on the stock to "overweight" and added it to its "Best Ideas List."
"After avoiding the stock for years, we are optimistic on Home Depot's prospects as housing begins its recovery," Morgan analysts wrote in a reserach note, citing margin potential as the industry recovers.
Disney and ExxonMobil also received analyst upgrades but ended the day lower.
The U.S. economic calendar is pretty light the next few days. Later in the week, a few important reads on the consumer: The government's retail-sales report and consumer sentiment.
Shares of CIT Group ended lower, after being up sharply earlier, as former Merrill Lynch Chairman John Thain was named chairman and CEO of the lending giant.
Shares of CVS Caremark and Hasbro soared after the pair beat earnings expectations. Hasbro also said it sees growth in 2010 and its stock had its largest one-day gain since 1996. CVS fell short with its sales number, but noted progress at its pharmacy benefits unit and its store sales still beat rival Walgreen, which saw sales slide.
The most prominent after-the-bell earnings report today comes from Electronic Arts, the biggest maker of video games.
Motorola shares gained after Barron's said the telecom could gain 40 percent if it spins off its cellphone division.
New reports say Toyotawill announce a global Prius recall on Tuesday, to fix braking problems in the third-generation version of its best-selling hybrid. Reports of such a recall first surfaced last week. Toyota shares are now down nearly 20 percent since Jan. 21.
AIG shares edged lower after CEO Robert Benmosche said he envisions a smaller company in the future as it sells many of its units to repay government bailout funds.
Amazon.com shares ended lower despite an upgrade from Collins Stewart to "buy," based on the stock's recent decline. Amazon has resumed selling hardcover books from publisher Macmillan, but not the company's e-books. Neither side will comment, but analysts see the resumption of hardcover sales as a sign that the dispute over e-book pricing may be closer to resolution.
Reports say Walt Disney is leading a consortium that's in talks to buy a stake in China's largest digital ad company, and that Google is among the investors in the group.
In related news, Lionsgate , a unit of Lions Gate Entertainment, is looking to buy Disney's Miramax unit, according to the New York Post.
MONDAY: Earnings from CVS Caremark and Hasbro
TUESDAY: Wholesale trade; 3-year note auction; Earnings from Coke, UBS, IAC, Pulte Homes and Disney; Mac World starts (through Sat)
WEDNESDAY: Weekly mortgage applications; trade balance; Google hearing; weekly crude inventories; Fed's Plosser speaks; 1o-year auction; Earnings from NYT, Sprint Nextedol, Boston Scientific and Prudential; Chicago auto show starts
THURSDAY: Retail sales; weekly jobless claims; 30-year auction; Earnings from Pepsi, Philip Morris, and Viacom; Fashion week starts; Miami boat show starts
FRIDAY: Consumer sentiment; Winter Olympics starts
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