by Marc Bastow | May 9, 2012 5:40 pm
The roller-coaster ride that is Europe took U.S. markets down yet again at the open of Wednesday’s session before another afternoon rally cut losses.
The Dow Jones Industrial Average finished down 0.67% at 12,845, while the Nasdaq eased 0.39% to 2,935 and the S&P 500 settled down 0.67% to 1,354.
Concerns in Spain drove markets early, as the benchmark Spanish 10-year bond yield soared over 6% for the first time in weeks while European countries wondered how to handle the situation in Greece, where a coalition government has yet to form after last weekend’s elections.
Perhaps sensing the market was oversold on the morning news, markets began their slow climb up during the midmorning on a solid earnings report from AOL (NYSE:AOL) and the continuing aura from Tuesday’s report from Disney (NYSE:DIS). AOL reported earnings of 22 cents per share, well in excess of estimates for 4 cents, and AOL shares were lifted handsomely, up 3.5%. Meanwhile, DIS moved ahead 1.6% a day after dazzling investors with its own solid operating results.
Laying low Wednesday were under-siege Dow components Bank of America (NYSE:BAC) and Citigroup (NYSE:C). A Citigroup investor filed a lawsuit against directors over alleging breaches of fiduciary duties by awarding more than $54 million of compensation in 2011 to certain top executives, including almost $15 million to its CEO, Vikrim Pandit. C shares were down 2.75% to close at $30.41, their worst closing price since early February. Meanwhile, BAC slid less than a percent as shareholders approved CEO Brian Moynihan’s $7 million executive pay package.
Technology heavyweight Cisco (NASDAQ:CSCO) reported third-quarter earnings of $2.2 billion, or 40 cents per share, that were up 20% over the year-ago period. Adjusted earnings of 48 cents per share were a penny better than analyst estimates, but it wasn’t enough to please investors, who knocked CSCO shares down about 8% in after-hours trading.
Investors also weren’t kind to Priceline (NASDAQ:PCLN), which reported strong growth in first-quarter earnings but forecast second-quarter earnings not to analysts’ liking thanks to concerns of weakness in travel to Europe. Priceline projected earnings of $7.20 to $7.40 in the second quarter, less than the average $7.43 estimate compiled by Bloomberg. PCLN shares were down more than 3% after the bell.
Marc Bastow is an Assistant Editor at InvestorPlace.com. As of this writing, he was long PBI, CSCO and AOL.
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