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4:28 PM, May 6, 2010 --

  • NYSE down 245.9 (3.4%) to 7,011.92.
  • DJIA down 347.8 (3.2%) to 10,520.
  • S&P 500 down 37.7 (3.2%) to 1,128.
  • Nasdaq down 82.7 (3.4%) to 2,320.


GLOBAL SENTIMENT

  • Hang Seng down 0.96%
  • Nikkei down 3.27%
  • FTSE down 0.97%


UPSIDE MOVERS

(+) HTRN sold to Endo Pharma (ENDP).

(+) AEZS jumps on ovarian cancer drug study results.

(+) ADCT continues gain that followed earnings beat.

(+) TGT erases early losses after disappointing with same-store sales, though maintains EPS view that could beat.

DOWNSIDE MOVERS


(-) ALU lower after earnings results.

(-) MGM lower after results.

(-) JDSU continues slide after missing with revenue, beating with earnings and guiding for revs to beat.

MARKET DIRECTION

Stocks ended with sharp losses but somehow finished considerably above the much steeper depths plumbed earlier in a volatile session. At one point, the Dow Jones Industrial Average wiped out 992.6 points, the most on an intraday basis on record.

Panic selling across electronic markets was cited on several news sites, with some even wondering if a technical glitch aggravated the drop. The NYSE issued a statement saying they had no evidence of any technical issues.

The market had chopped in mixed to sharply lower trading this week before Thursday's crumble, all in response to jitters surrounding Greece debt, its government's ability to implement austerity measures that include tax hikes and the European leadership's ability to stem contagion from Greece.

Banking stocks are leading the declines but tech, drugs, industrials and more were swept up in the drop.

The Federal Reserve is closely monitoring financial turbulence in Europe as it could have repercussions for the United States and its markets, policymakers at the central bank said on Thursday.

James Bullard, president of the St. Louis Fed, argued the European crisis, which centers on worries about the high debt level of Greece and other member states, poses a threat to an otherwise improving U.S. economic outlook, Reuters said.

European Central Bank President Jean-Claude Trichet played down contagion fears after the bank left interest rates unchanged at 1 percent. "Portugal and Greece are not on the same boat, and this is very visible when you look at the facts and figures," he told reporters after the rate decision in Lisbon. "Portugal is not Greece. Spain is not Greece."

But private sector firms and financial markets aren't entirely convinced. Moody's has warned that banks in Portugal, Italy, Spain, Ireland and Britain could all be hurt by a widening debt crisis.

Nerves were further grated by a jump in Spain's borrowing costs at a debt auction as investors demand a much greater payout for taking on presumably higher risk.

The euro fell another 1% to $1.2687.

Oil for June delivery, the most active contract, declined $2.86, to $77.10 a barrel. In other energy futures, heating oil was down 4.49%, or $0.09 to $2.08 a gallon while natural gas was down 1.7%, or $0.07, to $3.92 per million British thermal units.

Meanwhile, gold for June delivery rose $22.20 to $1,197.30 an ounce as investors sought its relative security.

Stocks actually got mild, if short-lived, support from a morning report showing a drop of 7,000, to 444,000, in the number of weekly jobless benefits claims. The jobless claims data come a day before the Labor Department is due with its key monthly jobs report, which is expected to show a steady 9.7% unemployment rate in April.

Investors also were little cheered by a better-than-expected U.S. productivity report. The Labor Department said Q1 productivity rose at an annual rate of 3.6%, better than the 2.5% forecast by economists.

In the U.S., April sales at stores open at least a year came in slightly worse than expectations. Sales were expected to be flat to down slightly after they rose a better-than-expected 9% in March, the industry's best monthly performance in more than a decade, according to trade group International Council of Shopping Centers. An early Easter pushed related shopping ahead to March.

Target (TGT) is off the day's worst levels after it said April sales in its higher margin categories, such as health care, beauty product and clothing, were strong, while lower margin sales of entertainment items like books and movies were weaker. But both business segments continued to outperform their respective profit plans for the first quarter. As a result, it expects Q1 EPS will meet or exceed the current First Call median estimate of $0.86.

In the tech space, Alcatel-Lucent (ALU) was an active decliner. It reported a Q1 loss of 515 million euros, wider than the year ago loss of 402 million euros. Revenue dropped nearly 10% to 3.25 billion euros.

Earlier in the day, Aeterna Zentaris (AEZS) is an active gainer after saying it has received from the U.S. Food and Drug Administration (FDA), orphan-drug designation for AEZS-108, its doxorubicin targeted conjugate compound, for the treatment of ovarian cancer. AEZS-108 is currently in a Phase 2 trial in advanced ovarian and advanced endometrial cancer in Europe.

In mergers and acquisitions news, HealthTronics (HTRN) soared after Endo
Pharmaceuticals (ENDP) said late Wednesday it would buy HTRN for about $223 million or $4.85 cash per share.

Source: Equities Close Volatile Negative Session Down 'Only' 3%