US markets fell yesterday following light trading volume and concerns over fourth quarter corporate earnings. Retailers fell on concerns that the holiday shopping season could be its worst for 40 years, while falling oil prices dragged the energy sector lower. The auto industry was again in focus following negative comments from Toyota Motor.
The Dow Jones fell 59.42 points to close at 8,519.69, the S&P 500 declined 16.255 points to end at 871.63. The Nasdaq slid 31.97 points to finish at 1,532.35.
Walgreen Co fell 4.2% following its first quarter results. The No 1 US drug store chain posted weaker than expected net income of $408 million or 41 cents a share. Analysts had forecast earnings per share of 46 cents. The company also said it was opening fewer stores than previously planned as consumers cut back on spending.
Manpower slumped after withdrawing its profit outlook following light demand for temporary workers as a result of the global recession. The top US staffing company plunged 14.2%.
The US listed Toyota Motor Corp slid 5% after saying it would suffer an operating loss for the first time in 71 years. General Motors plummeted 21.6% following comments from a Credit Suisse analyst. The brokerage downgraded the stock, whilst warning that the leading automaker may have already been drained of equity leaving shareholders out in the cold.
Caterpillar caused one of the biggest weights on the Dow after saying it would axe 800 jobs at one of its engine plants and cut white collar pay by up to 50%. Shares in the heavy machinery maker slipped 2.1%.
Energy stocks also weighed heavily on the Dow, following another slide in oil prices. Chevron lost 2.1% while Exxon Mobil fell 1.9%.
US light crude oil for February delivery dropped $2.45 to settle at $39.91 a barrel. COMEX gold for February delivery rose $9.80 to $847.20 an ounce. Treasury prices fell, raising the yield on the 10 year note to 2.14% from 2.07%
The Japanese Stock Exchange is closed today.
The Hang Seng dropped 401.60 points to close at 14,220.79 on concerns a smaller than expected interest rate cut in China will fail to prevent the nation's economy from slowing. Cathay Pacific Airways fell 1.9% after the South China Morning Post said the airline posted lower sales.
The FTSE 100 is currently 35.97 points higher at 4,285.13. Stocks are higher for the first time in three days as investors bought shares in companies which are more resilient to the slump in the economy. BAE Systems leads the risers, up 3.8%, Imperial Tobacco adds 2% while Diageo adds 1.5%. On the downside, Cobham loses 1.1% following a downgrade from Goldman Sachs to neutral.