Stocks on Wall Street extended their losing streak from last week as the ongoing political gridlock in Greece continues to weigh down on investors’ confidence. On the home front, profit taking pressures hit the S&P 500 Index the hardest, dragging it down by 1.11% on the day, while the Dow Jones Industrial Average fared slightly better, shedding 0.98% on the day. Amidst the looming uncertainties, gold also fell victim to profit taking. Futures prices for the precious yellow metal slid roughly 2% on the session, settling near $1,560 an ounce.
With no major economic data releases taking place on the home front this Monday, investors focused their attention overseas, where developments remain clouded with uncertainty. Madelynn Matlock of Huntington Asset Advisors commented, “The whole European political situation is really the focus at this point. Nobody really knows what’s going to happen next and the market hates uncertainty more than anything." Simply put, until there is a more clear-cut solution to the debt crisis in Europe, equity markets around the globe will likely remain volatile.
The Barclays S&P 500 VIX Short-Term Futures ETN (NYSEARCA:VXX) was one of the best performers, gaining an impressive 5.55% on the day. Volatility levels soared higher right from the opening bell this morning as uncertainty from Europe spilled over. As such, the VIX Index gained close to 10% on the day, settling near multi-week highs at the 21.77 level.
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Click to enlargeThe iShares MSCI Brazil Index Fund (NYSEARCA:EWZ) was one of the worst performers, shedding a dismal 4.03% on the day. This ETF sank lower thanks to broad-based profit taking pressures coupled with a sluggish performance from Petrobras (NYSE:PBR), the fund’s top holding. In fact, Petrobras has been dragging this fund lower for the past few weeks as falling oil prices combined with political uncertainty in Brazil’s energy sector have taken their toll on EWZ.
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