Tuesday, September 23, 2014
FAIRFIELD-SUISUN, CALIFORNIA
99 CENTS

European banking scare sends stocks lower

By
From page B6 | July 11, 2014 |

NEW YORK — Stocks fell Thursday as worries about the soundness of a European bank spooked U.S. investors, prompting them to sell stocks and snap up less risky assets like gold and governments bonds.

Fears emerged overnight about the financial stability of Espirito Santo International, a holding company that is the largest shareholder in a group of firms, including the parent of Portugal’s largest bank, Banco Espirito Santo.

Espirito Santo International reportedly missed a debt payment this week and was cited for accounting irregularities – similar to issues that sparked Europe’s debt crisis four years ago. The bank troubles had traders and investors talking about another European debt crisis.

Thursday’s stock selling started in Europe, and spread to the U.S, where the Dow Jones industrial average plunged as much as 180 points within the first half hour of trading.

But anxiety in the U.S. quickly subsided and the market clawed back in afternoon trading. While the market never fully bounced back, the decline in the Dow was roughly half of what it was at the beginning of the session.

“Today’s news did reignite some of those contagion fears,” said Ryan Larson, head of equity trading for RBC Global Asset Management.

Portugal is one of the smaller eurozone economies and, like Greece and Ireland, needed an international rescue in 2011 during the continent’s debt crisis. A three-year economic recovery program was supposed to have straightened out its finances.

That debt crisis in Europe was largely responsible for the U.S. stock market’s last decline of 10 percent or more, known as a “correction” in Wall Street parlance. Investors back then worried that the crisis would spread to the U.S., which was starting to recover from its own financial trauma.

On Thursday, the Dow fell 70.54 points, or 0.4 percent, to 16,915.07, erasing most of Wednesday’s advance.

The Standard & Poor’s 500 index fell 8.15 points, or 0.4 percent, to 1,964.88 and the Nasdaq composite fell 22.83 points, or 0.5 percent, to 4,396.20.

Traders and market strategists pointed to a couple of reasons why stocks didn’t continue falling in the U.S.

First, because it has been a relatively quiet week for Wall Street, with little economic data and only a couple companies reporting quarterly results, any negative news was likely “met with overreaction,” Larson said.

“After participants had time to step back and assess, many realized the U.S. is in a relatively good spot compared with (Europe),” he said.

Second, even with the U.S. market trading near all-time highs, many investors are sitting on large amounts of cash. Any noticeable fall in stock prices would likely mean investors would step in.

“Generally, people are willing to put money into this market when the opportunity presents itself,” said Erik Davidson, deputy chief investment officer of Wells Fargo Private Bank, which manages $170 billion in assets.

Investors did seek out some protection Thursday. Bond prices and gold rose as investors moved money into those traditional havens. The yield on the U.S. 10-year note fell to 2.54 percent from 2.55 percent late Wednesday. Gold rose $14.90, or 1.1 percent, to $1,339.20 an ounce.

In stocks, investors moved money into utility and telecommunication companies, also common areas to invest when uncertainty emerges in markets. Utility and telecom companies typically pay a higher-than-average dividend, which makes them attractive when investors don’t expect stock prices to go higher.

The Dow Jones utility index, a collection of 15 utility companies, rose 0.6 percent — the only major index to rise Thursday.

 

The Associated Press

The Associated Press

LEAVE A COMMENT

Discussion | No comments

The Daily Republic does not necessarily condone the comments here, nor does it review every post. Read our full policy

.

US / World

California wildfire crews brace for weather shift

By The Associated Press | From Page: | Gallery

 
LA County sheriff’s deputies testing body cameras

By The Associated Press | From Page:

 
Bear suspected to have killed New Jersey hiker

By The Associated Press | From Page:

Poll: Support for gay marriage may be leveling off

By The Associated Press | From Page:

 
Islamic State militants kill 40 Iraqi troops

By The Associated Press | From Page:

Sierra Leone, Liberia brace for new Ebola cases

By The Associated Press | From Page:

 
Islamist group kidnaps Frenchman in Algeria

By The Associated Press | From Page: , 3 Comments | Gallery

Pennsylvania governor confident ambush suspect will be caught

By The Associated Press | From Page: | Gallery

 
Focus on UVa employee in student’s disappearance

By The Associated Press | From Page: | Gallery

 
Prosecutor: 800 rounds found in intruder case

By The Associated Press | From Page: | Gallery

Islamic State offensive poses problems for Turkey

By The Associated Press | From Page:

 
Study links changing winds to warming in Pacific

By The Associated Press | From Page: | Gallery

Crews work to clear debris from Shasta mudslide

By The Associated Press | From Page: | Gallery

 
.

Opinion

Editorial cartoon for Sept. 23, 2014

By Daily Republic Syndicated Content | From Page:

 
Academia needs to act to protect college women

By Dan K. Thomasson | From Page:

 
.

Living

Today in History: Sept. 23, 2014

By The Associated Press | From Page:

 
Community Calendar: Sept. 23, 2014

By Susan Hiland | From Page:

 
Horoscopes: Sept. 23, 2014

By Holiday Mathis | From Page: B7

.

Entertainment

Kris Jenner files to divorce Bruce Jenner

By The Associated Press | From Page: | Gallery

 
Alaska TV reporter quits on air to promote pot

By The Associated Press | From Page:

Shonda Rhimes lays claim to Thursday nights on ABC

By Frazier Moore | From Page: | Gallery

 
Giuliani to help fight Noriega’s video game suit

By The Associated Press | From Page: | Gallery

‘The Lion King’ earns record box office

By The Associated Press | From Page:

 
Eric Lynch, Howard Stern’s diminutive foil, dies

By The Associated Press | From Page:

TVGrid Sept 23

By Daily Republic Syndicated Content | From Page: A11

 
.

Sports

Giants get closer, beat Dodgers 5-2 in 13 innings

By The Associated Press | From Page:

 
Prep boys water polo: Mustangs go 3-0 in Dixon tourney

By Daily Republic staff | From Page:

 
Prep boys soccer: Mustangs hold Indians to 0-0 draw

By Daily Republic staff | From Page:

 
MNF: Bears hold on to beat Jets 27-19

By The Associated Press | From Page:

Jeff Samardzija pitches A’s past Angels 8-4

By The Associated Press | From Page:

 
Nebraska’s Abdullah: Jameis Winston must grow up

By The Associated Press | From Page:

Raiders have to settle for moral victory

By The Associated Press | From Page:

 
Home of 49ers lineman Ray McDonald burglarized

By The Associated Press | From Page: , 1 Comment

Undisciplined play sends 49ers to 1-2 start

By The Associated Press | From Page:

 
Kicking game: It is called football, after all

By Barry Wilner | From Page:

US Soccer stands by Solo decision

By The Associated Press | From Page:

 
FIFA ethics judge hesitates on World Cup

By The Associated Press | From Page:

 
Braves fire GM Frank Wren after missing playoffs

By The Associated Press | From Page:

Royals beat Indians 2-0, gain on Tigers

By The Associated Press | From Page:

 
Bettman says NHL proactive about off-ice conduct

By The Associated Press | From Page:

Silver: NBA will review domestic violence policies

By The Associated Press | From Page:

 
Concern over McIlroy, McDowell more about results

By The Associated Press | From Page:

NFL vetting process: There are no sure things

By The Associated Press | From Page:

 
Owner: ‘No misinformation’ by Ravens on Rice

By The Associated Press | From Page:

This date in sports history for Tuesday, Sept. 23, 2014

By The Associated Press | From Page:

 
Kent creates scholarship for Cal women’s athletics

By The Associated Press | From Page:

 
.

Business

Treasury to unveil steps to curb tax inversions

By The Associated Press | From Page:

 
Tesco suspends execs over inflated profit report

By The Associated Press | From Page:

GM expert says 21 deaths eligible for compensation

By The Associated Press | From Page: | Gallery

 
Apple: 10 million iPhone 6 and 6 Plus sold

By The Associated Press | From Page: , 1 Comment

US existing home sales fall in August

By The Associated Press | From Page:

 
Investors fret Yahoo’s future, stock dips

By The Associated Press | From Page: | Gallery

Businesses and investors pressing for green policy

By The Associated Press | From Page: | Gallery

 
.

Obituaries

.

Comics

Garfield Sept 23

By Daily Republic Syndicated Content | From Page: B6

 
Baldo Sept 23

By Daily Republic Syndicated Content | From Page: B6

Dilbert Sept 23

By Daily Republic Syndicated Content | From Page: B6

 
Baby Blues Sept 23

By Daily Republic Syndicated Content | From Page: B6

Cryptoquote Sept 23

By Daily Republic Syndicated Content | From Page: B7

 
Beetle Bailey Sept 23

By Daily Republic Syndicated Content | From Page: B6

Zits Sept 23

By Daily Republic Syndicated Content | From Page: B6

 
Crossword Sept 23

By Daily Republic Syndicated Content | From Page: B7

Bridge Sept 23

By Daily Republic Syndicated Content | From Page: B7

 
Word Sleuth Sept 23

By Daily Republic Syndicated Content | From Page: B7

Frank and Ernest Sept 23

By Daily Republic Syndicated Content | From Page: B6

 
Pickles Sept 23

By Daily Republic Syndicated Content | From Page: B6

For Better or Worse Sept 23

By Daily Republic Syndicated Content | From Page: B6

 
Rose is Rose Sept 23

By Daily Republic Syndicated Content | From Page: B6

Sally Forth Sept 23

By Daily Republic Syndicated Content | From Page: B6

 
Get Fuzzy Sept 23

By Daily Republic Syndicated Content | From Page: B6

Sudoku Sept 23

By Daily Republic Syndicated Content | From Page: B7

 
B.C. Sept 23

By Daily Republic Syndicated Content | From Page: B6

Wizard of Id Sept 23

By Daily Republic Syndicated Content | From Page: B6

 
Blondie Sept 23

By Daily Republic Syndicated Content | From Page: B6

Peanuts Sept 23

By Daily Republic Syndicated Content | From Page: B6