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U.S. Stocks Tank As Cliff Deadline Looms

By Stock MarketsDec 28, 2012 09:21PM GMT Add a Comment
 
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With the January 1 fiscal cliff deadline just around the corner, market participants continued to shed U.S. equities, with major market averages slipping to session lows as the trading day closed.

The budget negotiation stalemate showed few signs of progress as President Obama and Congressional leaders from both parties are due to meet this weekend at the White House in what is widely considered a last-ditch effort to iron out a stop-gap budget deal.

Neither favorable home sales data nor good news from the Chicago Purchasing Managers index could lift market sentiment, as all eyes were on the action -- or inaction -- on Capitol Hill.

Home Sales
U.S. November pending home sales rose 1.7% to mark the third consecutive month of gains. The pending-home-sales index reached 106.4 in November - the highest level since April 2010, when buyers were trying to make a tax-credit deadline -- from 104.6 in October, the National Association of Realtors said.

In another positive data point, the Chicago Purchasing Managers index rose to 51.6 in December from 50.4 in November, marking the best performance in four months. Any reading above 50 indicates expansion.

HP Disappoints
In corporate news, technology stocks were led lower by Hewlett-Packard Co. (HPQ), which ended down 2.4%. HPQ filed its annual report with the SEC, announcing that the agency had opened an investigation into its Autonomy business, which HPQ alleges engaged in fraudulent accounting prior to its $10 billion acquisition of the British software firm last year.

All U.S. sectors finished lower, with energy the hardest hit according to NYSE sector indices.

European and Asian markets moved in different directions. Major bourses in Europe ended the week in the red, while Asian market averages uniformly posted modest gains.

Commodities traded in mixed fashion. Crude oil for February delivery ended $0.07 cents lower at $90.80 per barrel. February natural gas settled $0.057 cents higher at $3.47 per 1 million BTU.

In metals, February gold fell $8 to $1655.80 per ounce, while March silver dropped $0.27 to $29.97 per ounce. March copper was off a penny at $3.59 per pound.

Here's Where The Markets Stood At Day's End

  • Dow Jones Industrial Average down 158 (-1.21%) to 12,938
  • S&P 500 down 16 (-1.14%) to 1,402
  • Nasdaq Composite Index down 26 (-0.87%) to 2,960
GLOBAL SENTIMENT
  • Nikkei 225 Index up 0.70%
  • Hang Seng Index up 0.21%
  • Shanghai China Composite Index up 1.23%
  • FTSE 100 down 0.49%
  • DAX down 0.57%
  • CAC 40 down 1.48%
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