U.S. Market Indexes Lower as Valuations Suffer from U.K. Exit Vote
U.S. market indexes were lower Friday after the U.K. voted to exit the European Union. For the day the Dow Jones Industrial Average closed at 17399.86 for a loss of -611.21 points or -3.39 percent. The S&P 500 was also lower, closing at 2037.30 for a loss of -76.02 points or -3.60 percent. The Nasdaq Composite closed lower at 4707.98 for a loss of -202.06 points or -4.12 percent.
Source: DJIA, S&P 500 and Nasdaq Composite. Google Finance.
Friday’s Market Movers
An exit vote from the U.K. led to substantial losses for stocks in the U.S. as companies and investors evaluated how the exit would affect global trade, international sales and currency valuations among other factors.
The currency markets were volatile in trading for the day. The euro weakened against the dollar with an exchange rate of 1.1106. The pound was also weaker with a dollar exchange rate of 1.3676.
The day’s news is expected to continue affecting stocks as the U.K. takes steps towards new ties with the EU countries which could take a few years to reorganize. The country’s Prime Minister also announced his departure which will leave the country under new transitional leadership.
In the U.S., economic indicators reported on Friday included durable goods orders, consumer sentiment and the Baker-Hughes Rig Count. Durable goods orders were lower for the month with a -2.2 percent decrease. The University of Michigan’s Consumer Sentiment report showed an index level of 93.5 which was down from 94.3. The Baker-Hughes Rig Count added 4 rigs to increase to 497 for the week.
Stocks trading actively for the day with losses included Bank of America, Ford, Microsoft, General Electric, Citigroup, Apple and AT&T.
In the Dow Jones Industrial Average stocks leading losses for the day included the following:
Losses (percent)
Goldman Sachs -7.07
JPMorgan -6.95
Caterpillar -6.64
International Business Machines -5.64
Boeing -5.26
Sectors leading losses in the broad market included financial and materials. The Nasdaq Composite closed lower at 4707.98 for a loss of -202.06 points or -4.12 percent. The Nasdaq 100 was also lower at 4285.70 for a loss of -181.78 points or -4.07 percent. Stocks leading losses in technology included the following:
Losses (percent)
Liberty Global -13.61
The Priceline Group Inc. -11.37
NXP Semiconductors -8.34
In commodities, gold traded higher as evidenced by the SPDR Gold Trust which reported a gain of 5.95 points or 4.96 percent. The dollar was higher for the day as the U.S. Dollar Index gained 2.34 points or 2.51 percent to 95.55. The 10-year Treasury yield was lower at 1.56 percent.
Small-Cap Stocks
In small-caps, the Russell 2000 closed lower at 1127.54 for a loss of -44.69 points or -3.81 percent. The S&P 600 closed at 692.03 for a loss of -27.16 points or -3.78 percent. The DJ Small-Cap Growth TSM closed at 6893.78 for a loss of -295.57 points or -4.11 percent. The DJ Small-Cap Value TSM closed at 8155.06 for a loss of -292.98 points or -3.47 percent.
Other Notable Indexes
Other notable index closes included the S&P 400 Mid-Cap Index which closed at 1457.54 for a loss of -59.97 points or -3.95 percent; the Russell 3000 which closed at 1201.62 for a loss of -45.48 points or -3.65 percent; and the Dow Jones U.S. Select Dividend Index which closed at 592.71 for a loss of -14.84 points or -2.44 percent.
