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Volatile trade, Greece debt fears hit Wall Street PDF Print E-mail
Written by admin   
Friday, 07 May 2010 14:13

(Reuters) - U.S. stocks fell on Friday as continued fears of a financial meltdown stemming from Greece's debt crisis and lingering questions about what triggered the previous session's dramatic plunge discouraged investors.

Greece

Stocks were off their lows in afternoon trading after an early sell-off, but the major indexes turned negative for the year.

"Europe's debt crisis is a big issue that won't go away anytime soon. But with what happened yesterday, investors have grown more concerned that the environment just isn't safe, period," said Stephen Massocca, managing director at Wedbush Morgan in San Francisco.

"Now isn't exactly the time they want to buy stocks."

The Dow Jones industrial average .DJI was down 113.59 points, or 1.08 percent, at 10,406.73. The Standard & Poor's 500 Index .SPX was down 13.39 points, or 1.19 percent, at 1,114.76. The Nasdaq Composite Index .IXIC was down 43.11 points, or 1.86 percent, at 2,276.53. The indexes were on track for their worst weekly decline since March 2009.

The Nasdaq fared worse as technology stocks led the broader market lower. Apple Inc (AAPL.O) fell 4.4 percent to $235.41 and Intel Corp (INTC.O) dipped 1.5 percent to 21.19.

Stocks gained some support from government data showing the U.S. economy added jobs in April at the fastest pace in four years.

LINGERING QUESTIONS

Governments around the world tried to calm markets after fears about Greece's debt crisis went global, with investors seeing it as an omen of turmoil in other European economies.

Thursday's plunge drove the Dow index nearly down 1,000 points -- its biggest-ever intraday point drop.

The free-fall may have been exacerbated by erroneous trades that showed some shares briefly fell to nearly zero. The Nasdaq and other exchanges said they would cancel erroneous trades.

The U.S. Securities and Exchange Commission held urgent discussions with other regulators to try to shed light on the causes of Thursday's plunge.

Trades that took place during the worst of Thursday's drop will be canceled for more than 250 stocks, Nasdaq OMX said, adding to a long list of "busted" transactions on NYSE Euronext's Arca and other exchanges and trading venues.

The uncertainty around these cancellations could be heightening the day's price swings as investors examine their holdings.

"It could add to volatility because you have to unwind all of that," said Kurt Brunner, portfolio manager at Swarthmore Group in Philadelphia.


The CBOE volatility index .VIX was up 16.43 percent to 38.19 after rising as high as 42.15 earlier in the day, its highest since April 2009.

U.S. employers added 290,000 jobs in April, the Labor Department said, and revised figures for February and March to show 121,000 more jobs were added than previously thought. The unemployment rate, however, rose to 9.9 percent as the size of the labor force increased.

A Reuters poll of economists had forecast an April increase of 200,000 jobs and an unemployment rate of 9.7 percent.

(Additional reporting by Leah Schnurr; Editing by Padraic Cassidy)


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Last Updated on Friday, 07 May 2010 14:19
 
 
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