Stocks Decline On Eurozone Worries

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Includes: DIA, QQQ, SPY
by: Midnight Trader
  • DJIA down 198.67 (-1.63%) to 11,997.70
  • S&P 500 down 26.66 (-2.11%) to 1,234.35
  • Nasdaq down 52.83 (-1.99%) to 2,596.38

GLOBAL SENTIMENT

  • Nikkei down 0.66%
  • Hang Seng down 0.69%
  • Shanghai Composite down 0.13%
  • FTSE-100 down 1.14%
  • DAX-30 down 2.01%

U.S. stocks closed lower, with uncertainty in the eurozone dictating market direction. Stocks got off to a shaky start this morning after European Central Bank President Mario Draghi said that the central bank's bond buying program was "neither eternal nor infinite" and deflected questions about more bond purchases by the ECB.

More downside came later when the European Banking Authority announced that the aggregate capital shortfall for European banks amounted to 114.7 billion euros ($152.7 billion), with lenders looking at having to raise 8 billion euros more than previously estimated by the EBA in October.

The European data dictated the market's direction, as more positive data out of the U.S. was "shrugged off." Stateside, the Labor Department showed that U.S. jobless claims fell by 23,000 to 381,000 last week. Wall Street Economists had forecast claims would fall 9,000 to 393,000. The number of initial claims in the week ending Dec. 3 fell 23,000 to 381,000; Wall Street economists expected claims would fall 9,000 to 393,000. The four-week average dropped 3,000 to 393,250.

The U.S. Department of Commerce showed that U.S. wholesale inventories rose 1.6% in October. Compared to October last year, inventories have jumped 10.9% at the wholesale level.

In company news:

Exxon Mobil (NYSE:XOM) shares were down while MarketWatch reports the oil major expects demand for electricity will drive the energy industry. The comments came as a part of its Energy Outlook. The report concluded that natural gas will gain market share while oil will remain the most widely-used fuel.

Shares of Pinnacle Airlines Corp. (PNCL) collapsed after the company said it was in trouble and needed to make deals with its partner airlines, creditors and workforce to cut costs and lower its debt, according to MarketWatch.

THQ (THQI) shares slid following the video game publisher's warning on its Q3 results. The company said late Wednesday it now expects to report net sales for the third quarter of approximately 25% below its previously announced guidance of $510 million to $550 million. The Street view is for EPS of $1.37 on sales of $529.43 million.

Shares of Tennessee Commerce Bancorp (OTC:TNCC) fell after it said in a SEC filing its subsidiary, Tennessee Commerce Bank, failed to increase its capital to a level sufficient to restore the Bank to an "adequately capitalized" status and applicable FDIC regulations by December 2.

McDonald's (NYSE:MCD) shares firmed after the burger chain announced that its November global comparative sales increased 7.4%, beating the 5% gain analysts had expected.

Commodities closed down. Crude-oil for January delivery retreated $2.15 to end at $98.34 a barrel on the New York Mercantile Exchange. That was oil's lowest settlement since Nov. 28.

Gold futures declined 1.8% to settle at their lowest in more than a week.

Gold for February delivery declined $31.40 to $1,713.40 an ounce on the Comex division of the New York Mercantile Exchange.

UPSIDE MOVERS

(+) MCD, November global comp sales increased 7.4%

(+) PSUN, Upgraded to Neutral from Underweight at Piper Jaffray

(+) GIII, Reported Q3 sales better than the analyst consensus

(+) AFFY, FDA committee votes in favor of anemia treatment

DOWNSIDE MOVERS

(-) AIS, Oxybutynin gel receives FDA approval

(-) CREE, Downgraded to Equalweight from Overweight at Morgan Stanley

(-) MEI, Swings to profit in Q2; reaffirms FY12, FY13 outlook

(-) TSLA, Cut to Underweight from Overweight at Morgan Stanley

(-) COST, Q1 EPS in line, revenue just beats street view

(-) CLWR, prices upsized offering

(-) HIG, plans additional cost cuts