The major indices dropped again Monday, as the markets fell to late selling pressure, led by the tech sector. The Dow Jones Industrial Average fell 55.2 points (-0.42%), Standard & Poor's 500 index decreased 14.5 points (-1.00%), and the Nasdaq dropped 43.8 points (-1.67%). Volume on the NYSE came in at 1.71 billion shares, and advancers fell to decliners by a ratio of about 2:1.
A new $80 billion fund created to increase liquidity in short-term market debt will be started by Bank of America (unchanged), JP Morgan (+0.2%), and Citigroup (+1.4%), according to the New York Times. IBM (+1.2%) announced it would be acquiring software developer Cognos (+7.9%) for $5 billion (full story). E*Trade (-58.7%) fell hard after the online broker said losses from subprime exposure were likely more than initially estimated (full story) and analysts downgraded the company. U.S. bonds markets were closed Monday in observance of Veteran's Day.
Broad market weakness was mainly caused by the technology sector (-1.5%), but the energy (-3.8%) and basic materials (-3.7%) sectors also weighed the market down. Crude dropped $1.85 to $94.47/barrel, while gold slipped $27.00 to $807.70. Tyson Foods (-2.9%) was the only member of the S&P to report Monday, and both the company's earnings and guidance fell short of estimates (full story). Blackstone (-8.3%) traded down after reporting a Q3 loss (full story). The New York Times reported potential bids for Wendy's (+1.2%) could disappear because of recent problems in the credit markets (full story).
The Pending Home Sales Index (10:00 AM) is due to be released Tuesday. The market will be watching for earnings from Wal-Mart (+1.00%), Home Depot (+1.5%), and TJX (3.0%), all set to report before the start of Tuesday's session.
Commentary: Can Market Recover From Another Earnings Season Blues? • Home Depot: A Buy at Current Levels?
Stocks to watch: TSN, WEN, BX, BAC, JPM, C, IBM, ETFC, COGN