Stocks Spiral Down, Dividends Cut, Insurers Surge

Stocks spiraled downward today due to growing earnings concerns and falling oil prices. Bloomberg reported that 66 companies in the S&P 500 either cut or suspended dividends this year with the second quarter pay out dropping 23.4%. This is the largest decline in 40 years per Howard Silverblatt, a senior analyst at Standard & Poors. Bucking the downward trend, insurance companies rallied on news that the Obama health plan may delay creating a government operated plan. The DJIA dropped -161.27 to 8163.60, the Nasdaq fell -41.23 to 1746.17 and the S&P 500 gave back -17.69 to 881.03.

Aetna
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– Climbed along with others in the insurance sector adding 6.31% or $1.54 to $25.95/share on relief that Obama may delay creating a government health plan.

Discover Financial
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– Fell 10.76% or $1.13 to $9.36/share as the struggling credit card issuer said it would offer $500 million dollars of additional shares to raise capital.

Metro PCS
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– Climbed 3.57% or 42 cents to $12.19/share after UBS restated its buy rating.

Weyerhaeuser
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– The papermaker fell 7.10% or $2.13 to $27.86 upon cutting its dividend from 25 cents to 05 cents/share.

Oil fell $1.12 to $62.57, Gold climbed $4.80 to $929.10 and the fear index VIX spiked 6.38% to 30.85.

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Market Snapshot

Dow

-161.27 8163.60

NASDAQ

-41.23 1746.17

S&P 500

-17.69 881.03

Economic
News

ISM Service (Jun): Consensus: 46.0, Prior: 44.0

Crude Inventories (07/03): Consensus: NA, Prior: -3.66M

Consumer Credit (May): Consensus: -$7.5B, Prior: -$15.7B

Initial Claims (07/04): Consensus: NA, Prior: 614K

Wholesale Inventories (May): Consensus: -1.0%, Prior: -1.4%

Export Prices ex-ag. (Jun): Consensus: NA, Prior: 0.3%

Import Prices ex-oil (Jun): Consensus: NA, Prior: 0.2%

Trade Balance (May): Consensus: -$30.0B, Prior: -$29.2B

Mich Sentiment-Prel (Jul): Consensus: 71.0, Prior: 70.8