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Overnight Markets: Wall Street falls on Portugal's bank woes

by Himanshu Singh on Jul 11, 2014 at 04:44

Overnight Markets: Wall Street falls on Portugal's bank woes

Wall Street declined on Thursday as concerns about the financial health of Portugal's top listed bank fuelled demand for haven assets.

The Dow Jones industrial average fell 71 points or 0.42%, to 16,915. The S&P 500 slid eight points or 0.41%, to 1,965. The Nasdaq Composite dropped 23 points or 0.52%, to 4,396.

Espirito Santo Financial Group, the largest shareholder in Portugal's Banco Espirito Santo, suspended trading in its shares and bonds, citing "material difficulties" at parent company ESI. The bank's shares tumbled 17.2%. Portugal's benchmark stock index fell 4.2% and Italy's FTSE MIB slid 1.9%.

Financial sector fell, with Wells Fargo & Co declining 0.7%. The bank will report earnings on Friday. Goldman Sachs and JPMorgan Chase both dropped 0.8%.

Among the day's biggest decliners was Lumber Liquidators which plunged 21.5% after the hardwood flooring retailer cut its earnings outlook.

Sandwich chain Potbelly Corp estimated second-quarter revenue and profit below analysts' expectations and its stock plummeted 25.1%, just above an all-time low of $10.91.

Exxon Mobil Corp. retreated 1% as crude prices climbed after a nine-day losing streak. Chevron Corp. fell 0.9%.

Home Depot sank 1.7% for the biggest decline in the Dow, while Lowe’s lost 1.4%. Deutsche Bank’s Michael Baker lowered his earnings estimates for the two biggest US home-improvement retailers by 1 cent a share each after Lumber Liquidators Holdings Inc. (LL) reported weaker-than-estimated results.

Tractor Supply Co. lost 2.4% after the farm-supplies retailer forecast second-quarter earnings below analysts estimates.

In Asia, shares declined on Friday in late morning trade amid concern about financial risks in Europe spurred a rally in the yen.

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