الرئيسية
Stocks came off their highs Monday after a
report that the S&P warned six triple-A euro zone nations risk
having their ratings downgraded.
Major U.S. Indexes
.DJIA
47.76
+0.4%
.NCOMP
23.36
+0.89%
0
.SPX
9.56
+0.77%
0
The Dow Jones Industrial Average came off its best levels but was still trading higher, led by JPMorgan [JPM
33.46
1.13
(+3.5%)
] and BofA [BAC
5.80
0.16
(+2.84%)
], after logging its [b]second best weekly point gain ever [/b]last week.
The S&P 500 and the Nasdaq also trimmed some gains but was still higher. The CBOE Volatility Index, widely considered the best gauge of fear in the market, traded around 28.
Most S&P sectors were in positive territory, led by financials and techs.
RELATED LINKS
S&P is scheduled to announce that it is putting Germany, France, the Netherlands, Austria, Finland, and Luxembourg [b]on "creditwatch negative" later this afternoon[/b], implying the possibility of a downgrade within 90 days, according to the Financial Times.
“This
is a natural consequence if France and Germany bails everyone else out
because the EU is a fully shared fiscal and monetary union,” said Brian
Battle, director and vice president of trading at Performance Trust
Capital Partners. “You’ve taken a currency union and married it to a
fiscal union without realizing the consequence of the behavior—the
economic reality has caught up to the political dream [of the EU] and
we’re seeing that clash happen.”
Stocks
had been trading higher for most of the session after France and
Germany's leaders said they had completed an agreement on a plan to help
resolve the euro zone debt crisis ahead of a crucial EU summit later on
this week.
Europeansharesadded to last week's record gains, as French President Nicolas Sarkozy and German Chancellor Angela Merkel met [b]ahead of Friday’s key summit[/b].
Both the French and German leaders [b]called for treaty changes [/b]aimed at applying stiff sanctions to fiscally wayward national governments.
Although
France and Germany want these changes to all 27 members of the EU,
Sarkozy said the changes could be limited to just the 17 countries who
use the euro. In addition, Sarkozy said he wants the treaty changes
concluded by March.
And
the IMF board approved a 2.2 billion euro loan installment for Greece,
part of a 8 billion euro tranche that the debt-ridden nation was
expecting to get back in September.
Meanwhile, investors were also encouraged after Italy's Prime Minister Mario Monti [b]unveiled a 30 billion euro austerity package [/b]to Italy's parliament to help stem the nation's sovereign debt crisis.
The
package aims to raise more than 10 billion euros ($13.4 billion) from a
new property tax, impose a new tax on luxury items, crack down on tax
evasion and bring forward measures to increase the pension age.
On the economic front, the pace of growth in the U.S. services sector fell to 52.0 in November to the [b]slowest since January 2010[/b], according to the Institute for Supply Management. Economists polled by Reuters had expected a reading of 53.5.
And
factory goods slipped 0.4 percent in for the second straight month,
according to the Commerce Department, suggesting a possible softening in
the manufacturing sector. Economists had expected a decline of 0.3
percent.
“The
markets will grab onto any information even when there’s not much
information, so I think we’re still riding the economic news from last
week on the employment numbers and consumer confidence,” said Bill
Hampel, chief economist at CUNA. “We now strongly appear to have dodged
the bullet of a double-dip recession...[The economic trend] seems to be
moving in the right direction so it appears that numbers are likely to
surprise on the upside than downside.”
Barring
any overly negative news from Europe, Hampel added there should be a
boost in consumer and business spending in the next few months.
In corporate news, Germany's SAP [SAP
58.55
-0.99
(-1.66%)
] announced a [b]$3.4 billion cash deal [/b]to buy U.S. web-based software company SuccessFactors, joining the scramble among technology firms to offer cloud-computing services to businesses.
Samsung Electronics gained after Apple [AAPL
393.079
3.379
(+0.87%)
] [b]failed in a bid [/b]to halt U.S. sales of the Korean tech giant's Galaxy line of products.
U.S. metals recycler Commercial Metals [CMC
14.06
0.07
(+0.5%)
] rejected
billionaire investor Carl Icahn's buyout bid, saying the offer
substantially undervalues the company and is "opportunistic."
Among earnings, Dollar General [DG
40.48
0.54
(+1.35%)
]
gained after the discount retailer boosted its full-year earnings
outlook and posted a profit that topped estimates, helped by strong
sales.
Elsewhere,
China's services sector cooled in November to its weakest growth in
three months, according to the HSBC purchasing managers' index, the
latest data portraying an economy slowing quickly and in need of policy
support.
—Follow JeeYeon Park on Twitter: twitter.com/JeeYeonParkCNBC—
On Tap This Week:
TUESDAY: AmEx CEO speaks, GE Capital investor mtg; Earnings from Toll Brothers
WEDNESDAY: Weekly mortgage applications, quarterly services survey, oil inventories, consumer credit
THURSDAY:
BoE announcement, ECB announcement, McDonald's sales report, jobless
claims, wholesale trade, AT&T CEO speaks; Earnings from Costco,
Smithfield Foods
FRIDAY: International trade, consumer sentiment, Greek short selling ban expires, EU summit
report that the S&P warned six triple-A euro zone nations risk
having their ratings downgraded.
Major U.S. Indexes
.DJIA
12067.18
+0.4%
.NCOMP
2650.29
+0.89%
0
.SPX
1253.84
+0.77%
0
The Dow Jones Industrial Average came off its best levels but was still trading higher, led by JPMorgan [JPM
33.46
1.13
(+3.5%)
] and BofA [BAC 5.80
0.16
(+2.84%)
], after logging its [b]second best weekly point gain ever [/b]last week. The S&P 500 and the Nasdaq also trimmed some gains but was still higher. The CBOE Volatility Index, widely considered the best gauge of fear in the market, traded around 28.
Most S&P sectors were in positive territory, led by financials and techs.
RELATED LINKS
- China —Worse Threat Than Europe?
- 2011 Top S&P Stocks
- Cramer’s Stocking-Stuffer Stocks
- Hedge Funds Regain Losses
S&P is scheduled to announce that it is putting Germany, France, the Netherlands, Austria, Finland, and Luxembourg [b]on "creditwatch negative" later this afternoon[/b], implying the possibility of a downgrade within 90 days, according to the Financial Times.
“This
is a natural consequence if France and Germany bails everyone else out
because the EU is a fully shared fiscal and monetary union,” said Brian
Battle, director and vice president of trading at Performance Trust
Capital Partners. “You’ve taken a currency union and married it to a
fiscal union without realizing the consequence of the behavior—the
economic reality has caught up to the political dream [of the EU] and
we’re seeing that clash happen.”
Stocks
had been trading higher for most of the session after France and
Germany's leaders said they had completed an agreement on a plan to help
resolve the euro zone debt crisis ahead of a crucial EU summit later on
this week.
Europeansharesadded to last week's record gains, as French President Nicolas Sarkozy and German Chancellor Angela Merkel met [b]ahead of Friday’s key summit[/b].
Both the French and German leaders [b]called for treaty changes [/b]aimed at applying stiff sanctions to fiscally wayward national governments.
Although
France and Germany want these changes to all 27 members of the EU,
Sarkozy said the changes could be limited to just the 17 countries who
use the euro. In addition, Sarkozy said he wants the treaty changes
concluded by March.
And
the IMF board approved a 2.2 billion euro loan installment for Greece,
part of a 8 billion euro tranche that the debt-ridden nation was
expecting to get back in September.
Meanwhile, investors were also encouraged after Italy's Prime Minister Mario Monti [b]unveiled a 30 billion euro austerity package [/b]to Italy's parliament to help stem the nation's sovereign debt crisis.
The
package aims to raise more than 10 billion euros ($13.4 billion) from a
new property tax, impose a new tax on luxury items, crack down on tax
evasion and bring forward measures to increase the pension age.
On the economic front, the pace of growth in the U.S. services sector fell to 52.0 in November to the [b]slowest since January 2010[/b], according to the Institute for Supply Management. Economists polled by Reuters had expected a reading of 53.5.
And
factory goods slipped 0.4 percent in for the second straight month,
according to the Commerce Department, suggesting a possible softening in
the manufacturing sector. Economists had expected a decline of 0.3
percent.
“The
markets will grab onto any information even when there’s not much
information, so I think we’re still riding the economic news from last
week on the employment numbers and consumer confidence,” said Bill
Hampel, chief economist at CUNA. “We now strongly appear to have dodged
the bullet of a double-dip recession...[The economic trend] seems to be
moving in the right direction so it appears that numbers are likely to
surprise on the upside than downside.”
Barring
any overly negative news from Europe, Hampel added there should be a
boost in consumer and business spending in the next few months.
In corporate news, Germany's SAP [SAP
58.55
-0.99
(-1.66%)
] announced a [b]$3.4 billion cash deal [/b]to buy U.S. web-based software company SuccessFactors, joining the scramble among technology firms to offer cloud-computing services to businesses.Samsung Electronics gained after Apple [AAPL
393.079
3.379
(+0.87%)
] [b]failed in a bid [/b]to halt U.S. sales of the Korean tech giant's Galaxy line of products. U.S. metals recycler Commercial Metals [CMC
14.06
0.07
(+0.5%)
] rejectedbillionaire investor Carl Icahn's buyout bid, saying the offer
substantially undervalues the company and is "opportunistic."
Among earnings, Dollar General [DG
40.48
0.54
(+1.35%)
]gained after the discount retailer boosted its full-year earnings
outlook and posted a profit that topped estimates, helped by strong
sales.
Elsewhere,
China's services sector cooled in November to its weakest growth in
three months, according to the HSBC purchasing managers' index, the
latest data portraying an economy slowing quickly and in need of policy
support.
—Follow JeeYeon Park on Twitter: twitter.com/JeeYeonParkCNBC—
On Tap This Week:
TUESDAY: AmEx CEO speaks, GE Capital investor mtg; Earnings from Toll Brothers
WEDNESDAY: Weekly mortgage applications, quarterly services survey, oil inventories, consumer credit
THURSDAY:
BoE announcement, ECB announcement, McDonald's sales report, jobless
claims, wholesale trade, AT&T CEO speaks; Earnings from Costco,
Smithfield Foods
FRIDAY: International trade, consumer sentiment, Greek short selling ban expires, EU summit