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Overnight Markets: S&P 500 posts biggest drop since November on Europe

Shares fell after Spanish and Italian bond yields increased, renewing worries about the eurozone's sovereign debt crisis.

 
Overnight Markets: S&P 500 posts biggest drop since November on Europe

US stocks declined on Monday, with the S&P 500 registering its worst day since November, amid renewed concern that the eurozone crisis may intensify.

The Dow Jones industrial average was down 130 points, or 0.93%, at 13,880. The Standard & Poor's 500 Index was down 17 points, or 1.15%, at 1,496. The Nasdaq Composite Index was down 48 points, or 1.51%, at 3,131.

Shares fell after Spanish and Italian bond yields increased, renewing worries about the eurozone's sovereign debt crisis.

Spain's prime minister faced calls to resign over a corruption scandal, while a probe of alleged misconduct involving an Italian bank was expected to widen three weeks before a national election.

Adding to market pressure, data from the US Commerce Department showed overall factory orders for December were below economists' expectations.

McGraw-Hill lost 13.8% after news the US Justice Department plans to sue Standard & Poor's, a unit of McGraw-Hill, over its mortgage bond ratings.

Chevron and Wal-Mart were among the biggest drags on the Dow after analyst downgrades. Chevron dipped 1.1%, while Wal-Mart Stores Inc shed 1.2%.

On the positive side, shares of household products company Clorox increased 0.7% after quarterly profit beat analysts' estimates as a severe flu season boosted sales of disinfecting wipes.

In deal news, Oracle Corp agreed to acquire network equipment company Acme Packet Inc for $1.7 billion net of cash. Shares of Oracle were down 3% while Acme Packet shot up 23.7%.

Shares of Herbalife Ltd ended up 1.3%, recovering its losses ahead of the close, after the Federal Trade Commission corrected an erroneous statement that said the company was the subject of a law-enforcement probe.

In Asia, shares fell on Tuesday in morning trade bringing a recent rally to a halt amid political concerns in Spain and Italy.

The MSCI Asia Pacific Index slid 0.7% to 133 as of 11:38 a.m. in Hong Kong. Japan’s Nikkei 225 Stock Average slipped 1.2% after closing yesterday at its highest level since April 2010.

South Korea’s Kospi Index lost 0.7%. Singapore’s Straits Times Index fell 0.7% and Taiwan’s Taiex Index dropped 0.5%. Hong Kong’s Hang Seng Index slid 1.6% and China’s Shanghai Composite lost 0.4%.

1 comment so far. Why not have your say?

joe stalin

Feb 05, 2013 at 10:42

Right with the DOJ taking S&P to task over their role in the great MBS debacle now is the time for the FSA to stand up for this country and file as well. Lets take a leaf out of the US and the way they treated BP whose final bill may yet see $50BN! for a spill which actually did very little damage. Our banks bought into this fraudulently rated garbage pedled by the US investment banks and the rating agencies.. They were well and truly responsible for much that transpired. Our muppet regulators have still not grasped this little nugget though perhaps the DOJ might let them have some easy to grasp notes.

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