by Kyle Woodley | November 21, 2011 5:04 pm
The almost-routine political indecision from Washington took its toll on domestic markets Monday, with the congressional supercommittee charged with deciding on $1.2 trillion in spending cuts admitting almost certain failure Sunday. An official announcement came shortly after markets closed on Monday — two days before the official deadline that would trigger across-the-board federal spending cuts, most likely not taking effect until in 2013.
The supercommittee’s flop hammered markets already on shaky ground, thanks to mounting European debt woes. The Dow Jones was sent spiraling as much as 300 points, finishing the day down 248 points and at its lowest point since mid-October. The S&P 500 Index also shed about 2% and reached early October levels.
Numerous tech stocks were hit hard Monday. Embattled BlackBerry maker Research In Motion (NASDAQ:RIMM) reached a new 52-week low, dropping about 4.5% to finish at $17.36. Tech stocks Sony (NYSE:SNE) and Netflix (NASDAQ:NFLX) also found new basements, with NFLX shares shedding about 4.6% to fall to $74.47, and SNE dropping almost 4% to end the day at $16.28.
Hewlett-Packard (NYSE:HPQ) found itself trying to scream above the noise Monday after the bell. HPQ reported fourth-quarter earnings of $1.17 per share on revenue of $32.1 billion — both figures down from last year, when it earned $1.33 per share on $33.28 billion. Still, Hewlett-Packard beat Wall Street EPS estimates by four cents, and HPQ shares were up about 2% after hours — unfortunately, those gains were going toward clawing out of the 4% hole it dug during trading hours. HPQ finished Monday at $26.86.
One of the few winners Monday was pharmaceutical company Pharmasset (NASDAQ:VRUS), which gained about 85% after the announcement of an $11 billion buyout by Gilead Sciences (NASDAQ:GILD). VRUS is working on the first oral treatment for hepatitis C, a disease that affects more than 180 million people. Gilead investors apparently weren’t immediately hot on the deal, as GILD shares fell to $36.26, shedding about 9%.
As of this writing, Kyle Woodley did not hold a position in any of the aforementioned stocks. Check out our list of previous IP Market Recaps.
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