Obama supporters might be basking in the glow of success after the president achieved a closely fought yet ultimately decisive electoral victory, but Wall Street was surely feeling the blues after stock markets tanked in midday trading over fresh European worries.
European Central Bank president Mario Draghi said earlier that the bank foresees continued weakness in the eurozone economy “in the near term” and that Germany, too, had been dragged down by the debt criss, thus triggering a sell-off.
Of course, investors were also worried about the fiscal cliff after the elections
The Dow Jones Industrial Average
(INDEXDJX:.DJI) was down 2.36% to 12,933.16 points as of 11:52 a.m. EST, making today the worst trading day of the year. All 30 Dow components were in the red in intraday trading.
Financial stocks were hit hardest, with Bank of America
(NYSE:BAC) plunging 5.68% to $9.38 and JPMorgan
(NYSE:JPM) sliding. Investors were of the belief that Obama’s reelection meant a tougher banking regulatory environment in the near-term, which would hurt bank profits.
(NYSE:AXP) fell 2.54% to $55.74. The bellwether Financial Select Sector SPDR ETF
(NYSEARCA:XLF), which tracks all financial stocks in the S&P 500
(INDEXSP:.INX), fell 2.91% to $15.68.
(NYSE:UNH) also dropped 5.05% to $53.54. With Obama’s victory, his signature piece of legislation, the Affordable Care Act, looks like it’s here to stay, which has traders worried that compliance with health-care regulations would crimp health-care companies.
Tech stocks also encountered a sell-off, with Hewlett-Packard
(NYSE:HPQ) down 4.51% to $13.75 and Intel
(NASDAQ:INTC) dipping 3.04% to $21.07.
No positions in stocks mentioned.
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