Those recession fears are back in full force. It was the news that the U.S. service sector shrank for the first time in five years that spooked investors today. The number was shockingly weak, and was just the kind of number that gives investors a great reason to sell and ask questions later. The Dow fell 370 points on the day. The Nasdaq lost 73 points. The S&P 500 plunged 44 points, or 3.2% today.
There really were no bright spots in today's market, as every sector was in the red by at least 2%.
Financials were extremely weak as the recent strong uptick in the beaten down financials has started to unwind. JP Morgan Chase (NYSE:JPM) closed down by 5.04% on the day. Merrill Lynch (NYSE:MER) led the brokerage group lower, falling 5.6%. Bear Stearns (NYSE:BSC) also fell by 5.37% in the selloff. MetLife (NYSE:MET) fell 4.63% and Hartford Financial Services (NYSE:HIG) fell 3.95% as part of the weak insurance group. Fannie Mae (NYSE:FNM) also fell 6.42% on the day.
Energy stocks were also very weak today. Oil prices plunged more than 3% today and the oil stocks were hit hard. ConocoPhillips (NYSE:COP) shares plunged by 4.6% on the day. Hess Corporation (NYSE:HES) shares lost 5.44%, but it was on weak volume. XTO Energy (NYSE:XTO) shares fell by 5.67% today. Valero Energy (NYSE:VLO) shares were down on the day by 4.76%.
Tech stocks were certainly not able to escape the selling pressure. Garmin (Nasdaq:GRMN) shares fell 8.44% on fears of weak demand for their GPS products. Baidu.com (Nasdaq:BIDU) shares plunged 6.9% and Infosys (Nasdaq:INFY) shares fell 6.65% as international tech stocks were extremely weak today.
Notable 52 week lows
- Sanofi-Aventis (NYSE:SNY) Lost 5.7% on the day.
- Principal Financial Group (NYSE:PFG) Lost 11.22% after news of write downs.
- PMC Sierra (Nasdaq:PMCS) Shares fell 5.89% and they have now reached penny share level.
The volume today was actually not very strong, which is surprising given the huge downdraft in stocks today.
Going forward it will be all about the economic data. Today's service sector number from January was nothing short of shocking to almost everyone. If we don't get some economic data to turn the tide back in the bulls favor, the lows are liable to at least be tested, if not broken.
Comment Preview