by Marc Bastow | July 10, 2012 5:16 pm
Stocks opened higher Tuesday after eurozone finance ministers agreed to accelerate an initial bailout for ailing Spanish banks, but gains were erased in the afternoon as numerous negative headlines ripped apart a wide swath of sectors.
Patriot Coal (NYSE:PCX) filed for bankruptcy Monday evening, becoming the first U.S. coal producer to seek court protection since prices began to plummet thanks to cheaper natural gas.
The Chapter 11 filing in Manhattan set the stage for an industry bloodbath Tuesday, as James River Coal (NASDAQ:JRCC) shed almost a quarter of its worth, Arch Coal (NYSE:ACI) fell 8.4%, and coal conglomerate Consol (NYSE:CNX) dropped 2.25%. Since Monday’s announcement, PCX dropped from roughly $2 per share to about 27 cents.
Meanwhile, chipmaker Advanced Micro Devices (NYSE:AMD) announced that it expects second-quarter revenues to decrease approximately 11%, in stark contrast to an originally forecast increase of 3%. The lower results are primarily because of softer-than-expected channel sales in China and Europe. The net result Tuesday was a drop of 11.5% for AMD.
The ripple effect was felt among several sectormates, including at ARM Holdings (NASDAQ:ARMH), which fell nearly 4% on the day, and Intel (NASDAQ:INTC), which fell just over 2% by the end of the day.
Industrial equipment manufacturer and InvestorPlace Real America Index representative Cummins (NYSE:CMI) also reined in expectations, lowering its full-year revenue estimates and projecting Q2 revenue below analyst expectations, citing weakening demand thanks to — shocker — the global slowdown. Cummins shares were clobbered by 9% on the day.
Competitors Navistar (NYSE:NAV) and Caterpillar (NYSE:CAT) found the going just as tough, falling 7% and 3.5%, respectively.
Also of note, MAKO Surgical (NASDAQ:MAKO) was hammered after announcing a cut in its sales forecast for the year — the second such move in as many months. Shares dropped an eye-popping 47% on the day to close at a 52-week low of just more than $14 per share.
These drops and more helped the Nasdaq to a full 1% loss, with the S&P 500 shedding 0.81% to 1,341 and the Dow Jones Industrial Average dropping 0.65% to 12,653.
Tuesday had a little good news, though. The Labor Department announced that job openings rose in May over April, a potentially good sign for the economy — except the government also noted that job layoffs are at their highest point since July 2010.
Also, Coca-Cola (NYSE:KO) shareholders approved a 2-for-1 stock split, but early-day fizz in the stock eventually flattened out by the bell.
Marc Bastow is an Assistant Editor at InvestorPlace.com. As of this writing, he was long INTC.
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