US Stocks Tumble; China Concerns, Housing Data Stoke Anxiety

[Coventina]

Source: Wall Street Journal

NEW YORK (Dow Jones)--U.S. stocks tumbled Wednesday as a report stoked fears that China may curb bank lending and housing starts fell by more than expected last month.

The Dow Jones Industrial Average was down 131 points, or 1.23%, at 10594, with Kraft Foods as the measure's worst performer. Kraft extended its losses from Tuesday, down 2.8%. Bank of America led the Dow after releasing earnings earlier on Wednesday. Bank of America was up 1.1% in early trading after posting a fourth-quarter loss of $194 million. Its revenue from trading fell sharply, but its mammoth consumer loan books showed signs of stabilizing.

The Standard & Poor's 500-share index was down 1%, with only its health care sector in the black, following Tuesday's special election in Massachusetts, which could upset the current state of Congressional health care legislation. The tech sector dragged on Wednesday, after International Business Machines reported after the market's close Tuesday that its fourth-quarter profit grew 8.7%. The tech giant posted higher margins and revenue inched up, but the company provided a 2010 profit outlook that didn't meet some expectations. IBM was down 2.6% on Wednesday.

The tech-heavy Nasdaq Composite was down 0.9%.

Adding to investor anxiety, housing starts slid by 4.0% from the previous month to a seasonally adjusted 557,000 annual rate in December, the Commerce Department said Wednesday. Economists surveyed by Dow Jones Newswires had expected starts would dip by 0.2% to an annual rate of 573,000. However, building permits in December jumped 10.9% to a 653,000 annual rate. Economists had expected permits to rise by 0.2% to a rate of 590,000.

Read more: http://online.wsj.com/article/BT-CO-20100120-709147.html?mod=rss_Global_Stocks

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Well, it looks like Brown's win in Mass. didn't do much for the markets!

[Democat]

1. If Coakley won, they would have blamed her - but Brown won...

So it's nothing to do with the election. That's the media for you.

[Cirque du So-What]

2. Especially that particular member of the media

Already a right-leaning publication, the WSJ is now just another Murdoch house organ.

[paulsby]

11. as a trader, i can tell you that both ideas are ludicrous

i challenge anybody to be a successful trader with such (ex post facto) market analysis.

[Warpy]

3. Bullshit. The market just doesn't like REPUBLICANS

Funny how the modest gain on Monday was because Brown's election was in the bag. Now that he's in, the market lays an egg.

[thunder rising]

10. Exactly!! It was a pump & dump.

[BunkerHill24]

4. Lets ask what Tweety thinks?

That demented asshat was saying Brown should run against Obama in 2012. What a blockhead!

[KansDem]

5. I wonder about an impending housing crash...

I look around and see many folks like me who have purchased homes and are counting on resale value to cushion me in my old age. A couple of years ago, my sister and BIL sold their house they bought in southern California in the late 1960s and moved to Idaho. I'm not certain, but I think they got something like 10 to 15 times what they paid for it (this occurred before the housing crash). It made for a nice nest-egg.

Now, however, we see the beginning of a crashing housing market. I say this based on two observations:

1) There will be many of us retiring and wanting to sell our homes in a market where you have fewer buyers who can afford to buy a house)
2) There will be fewer well-paying jobs for future hopefuls to buy homes, at least at prices that will benefit upcoming retirees and their nest-eggs.

Consequently, when there are more empty houses than buyers, I see home prices plummeting and leading to uncertainty for those retiring in the next 10-15 years.

[OnlinePoker]

6. The beginning of a crash?

Where have you been for the last 3 years?

[KansDem]

7. I was referring to a crash that might take decades to correct...if ever...

I believe the last three years is just the beginning...

It just makes sense that if you have fewer qualified home buyers due to reduced wages, credit freezes, and outsourcing, and a larger number of homes for sale, there's going to be a lot of "investment" lost--investment that was going to assist retirees.

And how long will this last? Generations?

Maybe it'll never be "corrected."

[SpiralHawk]

9. The last 3 years was just the beginning

You got that right. The Republicon Homelanders have engineered Shock & Fail for years to come...

[boomerbust]

8. New phrase

Teabagger Bounce

[ConcernedCanuk]

12. Aw - everyone just settle down will ya?

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The PTB will up the debt limit by over another trillion dollars or so

That'll fix everything . .