Can Bulls Lift a Market Threatened By Uncertainty Surrounding U.S. Stimulus Measures?
June 28, 2010 at 06:00 AM EDT
Stocks spilled the past week like water over a broken dam as investors priced in more evidence that consumers, businesses and home-buyers have gone on strike despite U.S. stimulus measures and record-cheap interest rates that have put mortgages, car loans and store-credit costs at 100-year lows. In the five-day span, the Dow Jones Industrial Average fell 2.5% and the Standard & Poor's 500 Index sank 3.6%; Nasdaq and Russell 2000 Index all fell 3.2%. Catalyst for the latest spasm of selling came from disappointing news on durable goods sales and initial jobless claims, and weak earnings news or outlooks from consumer-facing companies Bed Bath & Beyond Inc. (Nasdaq: BBBY ), Darden Restaurants, Inc. (NYSE: DRI ), Lennar Corp. (NYSE: LEN ) and Nike, Inc. (NYSE: NKE ). All of the major U.S. and global indexes are now below their 200-day averages for the first time since early June.