Stocks were down big today as all eyes are on Europe. Investors want to see meaningful action at the EU summit tomorrow and if they don’t we could see an even sharper sell off. The trading day started off well enough after the ECB cut its interest rates 25 basis points to 1% and traders were feeling confident a solution was coming.
That all changed after ECB President Mario Draghi said the ECB will not be doing any large scale government bond purchasing programs. “It’s all about Europe right now,” says Todd Schoenberger, managing director at LandColt Trading. “The debt concerns, everything that’s happening just in those PIIGS – Portugal, Ireland, Italy Greece, and Spain; that’s impacting the European countries and their governments, but it also impacts our U.S. banks here.”
Stocks took a big hit after this with U.S. financial stocks taking the brunt. Bank of America (NYSE:BAC) lost 5.9% and closed the day at $5.59, erasing much of its gains from last week. Citigroup (NYSE:C) took an even bigger hit and lost 6.97% today closing at $27.75. Other U.S. bank losers included JP Morgan Chase & Co. (NYSE:JPM) losing 5.24% closing at $32.22 and Morgan Stanley (NYSE:MS) losing 8.42% closing at $8.42.
Winners were few and far between and had to have news of their own to overcome the down market. DemandTec, Inc. (NASDAQ:DMAN) shot up 55.99% closing at $13.15 after IBM said it will acquire the company for $440 million. Affymax, Inc. (NASDAQ:AFFY) rose 36.22% closing at $7.98 after a government panel voted 15-1 in favor, recommending the company’s drug gets FDA approval. G-III Apparel Group Ltd. (NASDAQ:GIII) finished the day up 17.98% at $24.02. G-III reported third quarter profits that beat analysts expectations and signed an agreement with Calvin Klein to open women’s clothing stores in the U.S. and China.
It looks tomorrow will be the day we know for sure one way or the other what exactly is going on in Europe. Hopefully they find a solution or uncertainty will send the markets in a tailspin.