Stock Market News for June 2, 2010 - Market News

A late-session selloff sent stocks broadly lower on Tuesday, with energy shares leading the drop, after the government said it will initiate criminal and civil investigations into the BP oil spill.  A pair of encouraging economic data, however, helped temper the losses.

BP’s failure in its latest attempt to stanch the worst spill in U.S. history and the announcement of criminal probe cast a shadow on the energy sector and sent shares in Anadarko Petroleum APC, Halliburton HAL and Transocean Ltd. RIG down at least 11%.  BP’s BP shares fell $6.43, or about 15%, to $36.52, its worst one-day percentage drop since 1974.  Shares in Chevron CVX and ConocoPhillips COP dropped 2.1% and 3%, respectively.  BP has lost more than one-third of its market value since the Deepwater Horizon exploded on April 20. Yesterday’s 15% drop in the company’s shares drew comments of its appeal as a takeover candidate

Markets fell in early going, weighed down by reports of a slower manufacturing growth in China, but better-than-expected data on U.S. construction spending and manufacturing activity brightened the moods before Attorney General Eric Holder’s announcement of a criminal probe into the spill sent stocks into a last-minute fall. 

This morning, U.S. stock futures suggest Wall Street would open with modest gains.  A slight rebound in euro is also pushing the futures up.  The currency had hit a fresh four-year low against the US dollar yesterday.  Dow Jones industrial average futures are up 44 points, or 0.4%, to 10,063.  Standard & Poor's 500 index futures are up 5.70 points, or 0.5%, to 1,075.20, while Nasdaq 100 index futures are up 15.00 points, or 0.8%, to 1,846.00.

Meanwhile, some of the biggest central banks, including those of Brazil, India, Japan, Russia and South Korea, noted in separate Reuters’ interviews today that there are no plans to wind down investments in dollar and the euro, due to greater liquidity characteristics of both the currencies.  The officials said they did not see alternatives to the two currencies in the near future.
 
On Tuesday, the Dow Jones industrial average dropped 112.61 points, or 1.1%, to 10,024.02.  The broader Standard & Poor's 500 index lost 18.70 points, or 1.7%, to 1,070.71, while the Nasdaq composite index closed down 34.71 points, or 1.5%, to 2,222.33.  Three stocks fell in price for every one that rose on the New York Stock Exchange where 1.43 billion shares exchanged hands.

All ten S&P500 industry sectors closed in the red Tuesday, led by oil and gas shares (-4.4%), basic materials (-3.8%), utilities (-2.3%), industrials (-2.2%), financials (-2.2%), consumer services (-1.4%), health care (-1.1%), technology (-1.1%), telecommunications (-1.0%), and consumer goods (-0.9%).

Global growth concerns and a possible China slowdown sent shares in Alcoa AA down 3.9%, the biggest drop among the DJIA components.  Copper, often sees as a proxy for growth, dropped to $3.1045 per pound from $3.1585 on Tuesday. Gold continued to glitter on its safe-haven appeal, however, rising 2.7% over the past month, and 10.6% year-to-date.