Flag Product

U.S. Stocks Fall, Halting Six-Week Winning Streak as Banks Drop

Add to my list

Send to friend

Compare prices

Shop for it: (added from 1 site)

Buy itbloomberg.com

See more products from this brand »

Added by 1 people

mona_moolah added to Stock Market...

0 Hearts

Description:

By Lynn Thomasson April 25 (Bloomberg) -- U.S. stocks fell, ending a six-week winning streak for the Standard & Poor’s 500 Index, as concern grew that credit losses at banks are worsening and drugmakers slid following... See more » By Lynn Thomasson April 25 (Bloomberg) -- U.S. stocks fell, ending a six-week winning streak for the Standard & Poor’s 500 Index, as concern grew that credit losses at banks are worsening and drugmakers slid following disappointing earnings at Merck & Co. The benchmark index for U.S. stocks climbed 1.7 percent yesterday on better-than-estimated earnings from Ford Motor Co., American Express Co. and Microsoft Corp. Bank of America Corp., the biggest U.S. bank by assets, sank 14 percent this week as bad loans increased, while Morgan Stanley tumbled 12 percent after its first-quarter loss was wider than analysts estimated. Merck sank 8.9 percent on its 57 percent drop in earnings. “The financials are setting a big tone for the market,” said Marc Harris, co-head of global research at RBC Capital Markets in New York. “We still have huge problems ahead.” The S&P 500 slid 0.4 percent to 866.23. The Dow Jones Industrial Average retreated 55.04 points, or 0.7 percent, to 8,076.29. The Russell 2000 Index of small companies slipped 0.1 percent to 478.74. The S&P 500’s first weekly drop in almost two months trimmed its advance since March 9, a 12-year low, to 28 percent. Profits slid 29 percent on average for the 201 companies in the index that reported first-quarter results. The period is poised to be the seventh straight quarter of declining earnings, the longest stretch since at least the Great Depression. The Federal Reserve released the methods yesterday that it used to conduct stress tests of the 19 largest American lenders. The assessments calculated the capital buffer the banks will need to keep making loans even if the economic downturn worsens this year and next. More Than Double Financial stocks in the S&P 500 slid 1.3 percent as a group. Losses were limited by a 16 percent surge in shares of American Express after the biggest U.S. credit-card company by purchases reported quarterly profit from continuing operations of 32 cents a share, more than double the average analyst estimate. Bank of America fell 14 percent to $9.10 even after saying first-quarter net income more than tripled on gains from home refinancing and trading. Reserves for future loan losses increased 57 percent to $13.4 billion since the end of December. Morgan Stanley slumped 12 percent to $21.96. The bank, which had a quarterly dividend of 27 cents a share for the past four years, slashed its payout to 5 cents as real estate and debt-related writedowns overwhelmed trading gains. Merck declined for a fourth week, dropping 8.9 percent to $23.45. The drugmaker buying rival Schering-Plough Corp. said profit fell on declining sales for its cervical cancer vaccine and treatments for cholesterol and bone loss. Cost of Insurance The VIX, as the Chicago Board Options Exchange Volatility Index is known, climbed 8.5 percent to 36.82 for the first advance in five weeks. The gauge measures the cost of using options as insurance against declines in the S&P 500. Sun Microsystems Inc. jumped 38 percent to $9.20 for the biggest gain in the S&P 500. Oracle Corp. agreed to buy the maker of servers and storage computers for about $7.4 billion in cash, swooping in after talks to be acquired by International Business Machines Corp. failed. Ford rose 25 percent to $5, the highest price since September. The only U.S. automaker not on government aid posted a first-quarter loss that beat analysts’ estimates as it cut cash use almost in half. Microsoft rallied 8.9 percent to $20.91. The biggest software maker posted a smaller drop in profit than some investors forecast and predicted bigger cost savings this year. ‘Market Is Attractive’ “The stock market is attractive,” said Jason Pride, director of research for Radnor, Pennsylvania-based Haverford Trust Co., which oversees $5 billion. “We’re starting to actually shift our portfolios toward more economic sensitivity.” More than 160 companies in the S&P 500 are scheduled to report quarterly results next week, including Exxon Mobil Corp., MasterCard Inc. and Pfizer Inc. Analysts’ estimates compiled by Bloomberg show profits for See less »

Comments (0)

Add a Comment:

Not a Kaboodler? Join Now, It's Free!

Email:

Screen Name:

Password:

Birthday:

Security Check
(Reload)

Enter Both Words

I have read and agree to the Terms of Service

Remember me on this computer.

Kaboodle will send you a newsletter and updates from your friends. You can unsubscribe at any time. Kaboodle does not sell or share your email address or personal information with anyone.

Cancel Already a Kaboodler? Sign in

U.S. Stocks Fall, Halting Six-Week Winning Streak as Banks Drop

Comments (0)

Add a Comment:

Thanks for Hearting!

Not a Kaboodler? Join Now, It's Free!

Sign in to Kaboodle