by Alyssa Oursler | February 4, 2013 4:57 pm
[1]Worries about Europe — particularly regarding a Spanish corruption scandal and Italy’s election — and a sliding euro left stocks in the red for the day, sending them down from previous five-year highs and sinking the Dow Jones Industrial Average back below 14,000.
The Dow was the day’s “best” performer — little consolation for its triple-digit drop to 13,880.08, or -0.93% lower. The S&P 500 fell 1.15% — its biggest decline of the year — to 1,495.71, and the Nasdaq lost 1.51% to end at 3,131.17.
The Commerce Department did report a rebound in U.S. factory orders for December, but the 1.8% increase was still smaller than expected. News also broke that Standard & Poor’s will face a lawsuit from the U.S. Justice Department over mortgage bond ratings before the financial crisis.
In specific stock news, Herbalife (NYSE:HLF[2]) tanked as much as 9% early Monday on news of a law enforcement probe[3] before rebounding to a 1% gain. Controversy has surrounded the stock ever since Bill Ackman called the stock a pyramid scheme[4].
Oracle (NASDAQ:ORCL[5]) slipped nearly 3% on the news that it will pay around $2 billion[6] for network gear maker Acme Packet (NASDAQ:APKT[7]). Shares of Acme, on the other hand, jumped 24% overall — more than the 22% premium paid by Oracle.
Blackberry (NASDAQ:BBRY[8]) — which just switched from its previous name[9] of Research In Motion — was another big gainer on the day. Investors sent BBRY up to the tune of 15% after Bernstein Research upgraded it to “outperform.” The company debuted its new BB10 smartphone[10] last week.
On the earnings front, media conglomerate Gannett (NYSE:GCI[11]) shed nearly 7% after the company reported a drop in net income for the fourth quarter despite a bump in broadcasting and digital ad sales. Royal Caribbean Cruises (NYSE:RCL[12]) also found itself in the red today, losing more than 3%. The company lost nearly $400 million during Q4 thanks to weak European demand.
Lastly, Yum Brands (NYSE:YUM[13]) dipped 4% after hours after it reported a 6% slowdown in China same-store sales and forecast single-digit earnings contraction in 2013. For Q4, YUM earned 83 cents on $4.15 billion in revenues, barely beating out expectations of 82 cents on $4.12 billion in revenues. YUM’s after-hours decline follows a 3% loss during regular Monday trading.
Bucking the trend was healthcare company Humana (NYSE:HUM[14]), which gained around 5% despite a nearly 4% dip in profits. Its earnings of $1.19 per share on revenue of $9.6 billion handily beat analyst expectations of $1.06 per share on revenue of $9.73 billion.
Notable earnings on Tuesday include Zynga (NASDAQ:ZNGA[15]) and Disney (NYSE:DIS[16]).
As of this writing, Alyssa Oursler did not own a position in any of the aforementioned securities.
Source URL: https://investorplace.com/2013/02/stocks-slip-on-european-concerns-mondays-ip-market-recap/
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