Stock Market News for February 26, 2010 - Market News
Stocks failed to build on to Wednesday’s momentum and closed down modestly lower as first time claims for unemployment rose and worries about Greece’s debt problems resurfaced. Moody’s and Standard & Poor’s further soured sentiments by saying they may cut Greece’s debt rating if the country failed to rein in spending.
The US dollar spiked as investors turned to safe haven instruments. Bond prices rose, pushing yields lower. The yield on the benchmark 10-year Treasury note fell to 3.64% from 3.70% late Wednesday.
The Dow Jones industrial average, which fell as much as 188 points during the session, closed down 53.13 points, or 0.5%, at 10,321.03. The broader Standard & Poor's 500 index closed off 2.30 points, or 0.2%, at 1,102.94. The tech-heavy Nasdaq closed the day almost unchanged, helped by a 0.7% climb in Apple (NASDAQ:AAPL) shares. Unconfirmed reports said the iPhone maker is planning a four-for-one stock split.
Meanwhile, following on the heels of its rival PepsiCo (NYSE:PEP), Coca-Cola (NYSE:KO) announced a multi-layered deal to acquire the North American operations of its largest bottler Coca-Cola Enterprises (NYSE:CCE). Coca-Cola said it will shed its 34% stake in C.C.E. PepsiCo (NYSE:PEP) is about to close its $7.8 billion acquisition of its largest bottlers Pepsi Bottling Group (NYSE:PBG) and PepsiAmericas (NYSE:PAS). Coca-Cola led the decliners on the DJIA, off 3.7%.
Today Greece's prime minister told the country’s parliament the prior government had understated its budget deficit by half, following a visit by EU economic inspectors.
Fed Chairman Bernanke's second day of semi-annual congressional testimony, while barely holding something new, proved sufficiently uncertain on the economy to dampen expectations for building pressures to force interest rates higher any time soon. Bernanke nevertheless noted the central bank is trying to find out if big banks, including Goldman Sachs (NYSE:GS), aggravated Greece’s debt problems.
The US economic data continued to point toward a struggling recovery, meaning it will not be easy for the Fed to raise interest rates anytime soon. Yesterday, St Louis Fed President Bullard opined the US economy is "reasonably good;" most economists anticipate growth in fits and starts, likely adding to the market's volatility after last year's nearly straight run higher.
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