JPMorgan and Banks’ Blue Day: Monday’s IP Market Recap

Bank stocks and eurozone woes pull markets lower


IPMarketRecap JPMorgan and Banks Blue Day: Mondays IP Market RecapIt was raining up and down the Eastern seaboard, but pouring in New York as the cloud over JPMorgan (NYSE:JPM) spread across Wall Street to cover banking sector and markets overall. Stocks suffered a steep opening drop before a mild afternoon rally trimmed the fall — somewhat.

When all was said and done the Dow dropped 125 points, or 0.98%, to end at 12,695, while both the S&P 500 and Nasdaq each lost a fraction over 1%, finishing at 1,338 and 2,903, respectively.

JPMorgan’s $2 billion trading loss announced on Friday reverberated over the weekend, and the fate of its chief investment officer was decided. JPM stock dropped 3% to end the day at $35.79.

Concerns over similar hedging-losses as yet unseen brought both Citigroup (NYSE:C) and Morgan Stanley (NYSE:MS) down over 4% on Monday, while Goldman Sachs (NYSE:GS), Bank of America (NYSE:BAC) and Wells Fargo (NYSE:WFC) all suffered 2% losses.

Adding to the gloom was increasing uncertainty over the political situation in Greece, which still lacks a government, causing continued concerns over the eurozone’s stability.

On the upside, Groupon (NASDAQ:GRPN) traded up almost 18% all day in anticipation of a strong quarterly performance. Investors were rewarded as the company reported better-than-expected revenue for its first quarter on Monday, along with a strong future forecast. Shares were up an additional 10% in after-hours trading.

Beauty-products maker Avon (NYSE:AVP) announced  Sunday it will respond to Coty’s latest offer to acquire the company for $10.7 billion, or $24.75 per share, while also revealing that Warren Buffett’s Berkshire Hathaway (NYSE:BRK.B) was a backer of the bid. Shares of AVP were up 3% to $20 on the news.

Software maker BMC Software (NASDAQ:BMC) gapped up 8% to $43 on news that private equity firm Elliott Associates has taken a 5% stake in the company, and Yahoo (NASDAQ:YHOO) rose 2% to $15.50 on news that CEO Scott Thompson has left the company. Hedge fund investor Third Point will obtain three of the four board seats it was fighting for as part of a proxy battle.

Best Buy (NYSE:BBY) also rose on nonfinancial news, as founder Richard Schulze will step down as chairman after a probe found he failed to tell the board about allegations that then-Chief Executive Officer Brian Dunn was having an inappropriate relationship with a female employee. Shares rose 1.5%.

Three Up

  • Zynga (NASDAQ:ZNGA): Up 6.28% (47 cents) to $7.95
  • Chesapeake Energy (NYSE:CHK): Up 4.79% (71 cents) to $15.52
  • Arena Pharmaceutical (NASDAQ:ARNA): Up 3.93% (25 cents) to $6.61

Three Down

  • Shutterfly (NASDAQ:SFLY): Down 8.87% ($2.36) to $24.24
  • Silver Wheaton (NYSE:SLW): Down 7.79% ($2.06) to $24.40 (Read more about SLW here)
  • Advance Auto (NYSE:AAP): Down 6.88% ($6) to $82.34

Marc Bastow is an Assistant Editor at As of this writing he does not hold a position in any of the aforementioned securities.

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