E-mail updates
Follow on Twitter
Subscribe to RSSBy Matthew Craft, The Associated Press
NEW YORK — Stocks and the euro fell Wednesday as worries about Europe hang over financial markets. Energy companies fell hard as the price of crude oil plunged 4 percent. The dollar and Treasury prices rose as traders shifted money into lower-risk investments.
Italy's borrowing rates ratcheted higher and the euro slid below $1.30 for the first time since January, two signs that the debt crisis continues to pressure Europe's governments. The euro has lost more than 3 percent in three days.
Italy had to pay higher borrowing rates in its last bond auction of the year Wednesday. The euro zone's third-largest economy paid 6.47 percent interest to borrow euro3 billion ($3.95 billion) for five years, up from 6.30 percent just a month ago. The higher rates make it more expensive for Italy to borrow money and reflect weakening confidence by investors in the country's ability to repay its debts.
According to preliminary calculations, the Dow Jones industrial average fell 131.46 points, or 1.1 percent, to 11,823.48
The market appears to be in "sell now and ask questions later mode," said John Canally, investment strategist at LPL Financial. The fear that another bank failure will lead to a wider financial crisis like Lehman Brothers did in 2008 overshadows everything else, he said.
In traders' minds, a slight drop in the euro or a small rise in Italian government bond yields is seen as a step toward a banking collapse. "Just the hint of bad news becomes 'Oh my gosh. The world is going to end,' " Canally said.
The Standard & Poor's 500 index fell 13.91, or 1.13 percent, to 1,211.82. The Nasdaq fell 39.96 points, or 1.55 percent to 2,539.31.
The yield on the 10-year Treasury note fell to 1.92 percent from 1.96 percent late Tuesday as demand increased for ultrasafe assets. The dollar also rose against other currencies. The euro lost about out penny against the dollar to $1.29.
European markets fell broadly, and the losses accelerated in the last hour of trading. Germany's DAX dropped 1.7 percent; France's main stock index fell 3.3 percent.
Energy stocks led the market lower after the price of crude oil plunged $4 to $96 a barrel. Schlumberger Ltd. lost 3.8 percent; Apache Corp. fell 4.3 percent and Cabot Oil & Gas Corp. fell 5.4 percent.
Leave a Comment:
You keep posting this stuff as if it's real... as if it matters. Our money isn't worth anything at this point. It doesn't matter what the stock market does. With the exceptions of REAL commodities (metals & gems), none of it has any value. The only reason the stock-market hasn't completely bottomed out is that the financial elite recognize that there's no point in pulling investments because make-believe dollars are worth no more or less than make-believe value assigned to a particular stock.
I'm curious though, what does MSNBC gain by perpetuating the lies? why not return to a journalistic approach? I mean we're all screwed either way. why not just be honest about it?
US dollar is worth a lot! US dollar is scarcer than Gold! Don't laugh. I am serious. Let me explain:
Debt is the world's problem and debt is denominated in US dollars. Borrowers must find US dollars to pay debt. USD will shoot up against everything as the crisis worsens. There is nowhere to hide. There is nowhere to diversify.
Price of euro, oil, gold, silver, stocks, bonds, homes cannot be sustained when the money supply deflates. Google for "DEFLATIONARY CRASH" to understand why US dollar becomes more valuable during financial crisis.
The dollar IS strong right now. I have two questions; Why this phony headline and why are American stocks effected ????? Oh wait !!!! I have the answer to both questions................GREED!!!!!
The price of oil is already way too high. It should be around $30 per barrel. No reason for it to be any higher unless you are one of the "oil speculators" trying to make millions of dollars for themselves and their clients, while screwing the middle class.
I agree. No need for oil to be as high as it is based on the fact "We COULD have a short supply" tomorrow. After 11 years of crazy speculation put it to rest. Even if the world does run out of oil jacking the price around makes nobody wants to use it.
Yeah, give us a break msnbc, oil companies have been gouging big time .... a nice word for theft .... why does oil all cost the same ..... price fixing....... the US shouldn't have any debt just take all the oil profits by taxing anything over $30.00 a barrel.
Willis,
If you were a farmer, and you heard about a big drought that could wipe out the wheat harvests of major southern hemisphere producers like Australia and Argentina. do you think your buyers would sit around and wait for the drought? Of course not, they'd start buying now. No one wants to risk paying a lot more, or getting shut out, when supplies are constrained. If the demand for wheat doesn't change, what do you think will happen?
Uh-Duh,
Gosh, why does gold cost the same everywhere. I mean, do you think you can buy it for less in Amsterdam than you can in London? Do you think a bushel of wheat is cheaper in Kansas than it is in Oklahoma? Try to think through what would happen if that were the case.
I suggest you go to your local supermarket and compare prices for beer 6 packs, twin ply toilet paper, and toothpaste, as a few examples. Then come back and tell us about those conspiracies too.
It's called a "commodity" Uh-duh. Look it up. Learn what it means.
How much do you think it costs to find, produce, and deliver a barrel of oil? Care to make a rough guess? Well, why should you guess. You must know, since you're making accusations. So let's hear it please.
Redskin,
Natural gas supplies about 20% of US energy. Utility companies with natural gas fired power plants have to buy it - they cant just shift to coal or nuclear overnight.
Natural gas is produced by the same companies that produce oil.
Natural gas is, like oil, also sold in futures markets and can be bought by speculators.
So, I'd like to hear your opinion on why the price of natural gas is less than half of what it sold for in the mid 2000's.
Why is it that Wall Street cares about Europe? This has been going on for a year? Anyone who is still invested in Europe is either a moron, or deserves to lose what they are betting. Mf Global learned the hard way, so should the other morons. There are many, many American companies that are getting record profits that are half valued. Keep money here and invest in America.
short answer is it is too expensive to invest in America, slave labor looks much more lucrative in China and other countries in stead of having to pay that evil minimum wage crap. /s
Until we make out sourcing a federal crime or penalize it through the tax code this will keep happening.
Commodity speculation is the cause of more grief for the middle class than almost any other cause. Wall Street is just a casino for the wealthy.
It does not matter what Europe announces about their debt and threatened Euro. They will continue to announce bold new plans, create committees and elaborate plans to restore prosperity, debate endlessly, resolve to meet again and deliberate some more before announcing a new rescue plan. The Europeans are very, very good at reaching consensus on meaningless proposals because in the end they will actually do nothing because they fear to upset their constituencies who are used to the good life and would throw them out of office or take to the streets before they could do anything meaningful to stop their profligate spending on cradle to grave social welfare. reminds me of the old Monty Python movie, Life of Brian, where the Jewish revolutionaries almost actually DID something until they pulled back resolved to do something, but not actually do anything right now. it was funny in the movie but not so funny in real time.
The market is a yo-yo and it will go back up soon on some 'good news'
I asked a friend in Holland today how much regular gas was. After converting the liter price to a gallon price it is $7.71 per gallon.
Yank,
The cost that owners of gas stations in Europe pay refiners for their gasoline is about the same as in the US. The difference in the prices consumers pay between the US and Europe is due to taxes at the retail level. Most countries tax gasoline pretty heavily as an incentive to reduce congestion and consumption.
Just wait until al those BLACK FRIDAY spenders credit cards come due in January and February without a pot to piss in !
Euro worries will be the least of US bank problems in2012!
If you want to see the economy take off, then gas will have to go back down to $1.35 a gallon.
Good point Ted415784, but it will never happen.
As long as our system allows people to buy commodities that they have absolutely no intention of ever taking possession of, oil and other commodities will always remain high.
You would be amazed at how many companies buy into the oil commodity market. Microsoft, AT&T ect. Why is Sam's &%&# do these companies buy oil? to makes millions in profit without ever touching the product that's why.
Our system is broke and has been for some time. As long as you allow it to continue, things are only going to get worse...
Really? Refer to post #2.4. Apparently those greedy folks are selective in what they want to make money on. They want to make a fortune in oil, but are willing to lose a fortune in natural gas. Go figure.
If our system is broke (sic), then so is the general level of education of the US public. An informed public wouldn't be making comments like ted or matt here.