"The big news started last night, when Cisco Systems (NASDAQ:CSCO) issued cautious guidance, and announced it would be cutting 5% of its workforce," said Schaeffer's Senior Equity Analyst Joe Bell, CMT. "Combine that with Wal-Mart's (NYSE:WMT) sluggish view on consumer spending, and many market participants were quick to sell anything and everything in their portfolio. All major sectors finished deep in the red, as investors looked to unload many of their positions after the past few weeks of sideways price action came to an end." Against this grim backdrop, the Dow Jones Industrial Average (DJI) closed at its lowest level since July 3.
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The Dow Jones Industrial Average (DJI - 15,112.19) tumbled right out of the gate and remained deep in the red for the rest of the session. By the close, the index lost 225.5 points, or 1.5% -- finishing just slightly north of its intraday low of 15,094.03 and below its 80-day moving average for the first time since late June. Caterpillar (NYSE:CAT) was the sole advancing blue-chip with its gain of 0.1%, while Cisco Systems (NASDAQ:CSCO) paced the 28 decliners with an earnings-induced loss of 7.2%. Alcoa (NYSE:AA) remained unchanged.
The S&P 500 Index (SPX - 1,661.32) didn't fare much better, and shed 24.1 points, or 1.4% -- its lowest daily close since July 10. Meanwhile, the Nasdaq Composite (COMP - 3,606.12) lopped off 63.2 points, or 1.7%.
The CBOE Market Volatility Index (VIX - 14.73) experienced some see-saw movement today, but finished the session 1.7 points, or nearly 13%, higher -- its first daily close above 14 since mid-July. The "fear barometer" is now on pace to end the week atop its 20-week moving average for the first time in more than a month.
A Trader's Take:
"There was quite a bit of economic data out today, and it wasn't all bad," Bell went on. "Initial jobless claims were actually better-than-expected, and came in at their lowest level since October 2007. Treasury yields once again jumped to new highs, with some believing this improvement could bring tapering sooner rather than later."
3 Things to Know About Today's Market:
5 Stocks We Were Watching Today:
For a look at today's options movers and commodities activity, head to page 2.
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