U.S. stock indexes and ETFs opened lower again on Thursday as global worries continue to haunt risk assets.
The news keeps coming hot and heavy with this morning’s headlines hammering home a steady list of bad news that drove stocks and ETFs lower:
1. Europe heads back into recession as Q3 GDP contracted 0.1%, the second straight decline to put the entire region in recession as protests spread across the region. European stock indexes posted significant declines with the DAX down 0.8% at noon New York time. Major Euorpean ETFs clung near flat line at noon EST with iShares MSCI Germany Index (NYSEARCA:EWG) +0.05%. Read European Protests Spook Stocks
2. Walmart misses expectations
3. Initial jobless claims rise last week, largely due to Hurricane Sandy, crossing the 400,000 barrier to 439,000.
4. Philadelphia Fed plunges to -10.7 from last month’s +5.7, again impacted by Sandy but deep in contraction territory which is “0.”
5. Hamas and Israel shoot rockets at each other as violence escalates in Gaza Strip, with reports of rockets hitting Tel Aviv.
6. Fiscal cliff debate continues to heat up with both sides digging in over tax hikes as Friday’s White House meeting approaches. Read Fiscal Cliff Sends Stocks Off Cliff
7. Market leader Apple Computer (NYSEARCA:AAPL) continues its dive, shedding 1.4% at mid-day. The Bear Bites Apple
On a technical basis, major support levels and moving average levels have been penetrated, however, major ETFs and stocks have reached oversold levels and so a short term bounce could be expected. The S&P 500 (NYSEARCA:SPY) has fallen through significant support levels while the Dow Jones Industrial Average ETF (NYSEARCA:DIA) has fallen more than 1,000 points since early October.
Bottom line: Stocks and ETFs face significant headwinds as the fiscal cliff approaches, now just 46 days away.